>> good morning everyone. welcome to squawk box here on cnbc. i'm becky quick with joe kernen and andrew ross sorkin. donald trump announcing his run for the white house. he has already upset neil young. another gop candidate and more controversy. i don't think we have permission to play it this morning either. let's get to our top story today. the countdown to the fed decision is on. at 2:00 p.m. eastern time the fed is widely expected to have no change in interest rates but i hike could happen before the year is out. the consensus of our cnbc fed survey is for a september rate hike. this is also a fed news conference day. yellen will be facing reporters

at 2:30 p.m. eastern time and that's when we might get real interest on what they have to say, the questions coming in and how she answers them. cnbc will be there. it all happens during power lunch today. they have a all star line-up. yesterday the dow was up triple digits. a gain of about 60 points. you see green arrows despite the concerns of greece. the dow futures up by 68 points. s&p futures up by 7.5. nasdaq up by 14. let's take a look at europe in the early trading. looks like right now things are modest declines. the biggest loser is the cac in france right now. down by about .5%. greece now sitting just at 700. as for the ten year note here in the united states you'll see that the yield at this point, 2.334%. not a massive change over what we have seen recently and look at the dollar because there's notes out this morning suggesting that the dollar

strength could continue because fed likely to raise interest rates this year. that's not going to be happening very likely at all for some time to come. you can see that the dollar is down fwensagainst the euro at 1.1262. >> and we have a little bit of ipo news this morning. pricing of fitbit's ipo available today. the maker expected to see shares priced between 17 and $19 a share. in total that would give the company a $3.7 billion market cap on day one and we'll talk a lot more about fitbit during the next half an hour. >> starbucks is packing up it's pastry shops. just three years now. they're closing their 23 la 23 la boulange shops. they acquired the parent company back in 2013 for $100 million.

shares are currently trading near an all time high. up almost 30% for the year. you can take your pick. did you like any of them better than the other? >> i liked the second one. la boulange. >> the midwest pronunciation. works with my ears. >> the ones in versailles indiana is called la boulange. sounds like w. >> you sound very presidential. should you say? >> yeah like the colonel. >> you're doing well. let's tell you about another story today. two private equity giants are making a bid for ncr. they're going to make a joint bid for ncr in a leverage buyout worth more than $10 billion including debt. they manufacture cash registers and atm.

shares jumping more than 10% on this report. >> and former aigo ceo is not going away quitely after that sort of win, sort of loss the other day in court. his firm planning to appeal a court decision which if you remember did not award him damages: even though the judge ruled that the government acted illegally in it's $85 billion rescue of the insurance giant. they were seeking $40 billion in damages at the time. we'll talk about the stability of the financial system and the implications of that decision on future government bailouts. that court decision of future government bailouts with jeb jeb hensariling. >> and disney giving a hat tip to universal for the big jurassic win. sending out a tweet to the cast and crew of jurassic world. a picture of the film star on

top of a t-rex holding thor's hammer. that used to be the top one. jurassic topped the avengers age of ultron by just over $1 million. >> it's nice and we're talking about the avengers so it worked. >> i guess so. among the stocks we're watching fed ex is expected to report numbers at around 7:30. it's quarterly report. analysts are looking for profits of 268 a share on revenue of 12.3 billion and we will also watch the shares of adobe, the maker of the popular photo shop software did beat estimates by 3 cents but it's current quarter earnings revenue outlook was below forecasts. >> we are counting down to the fed policy statement this afternoon. the market is optimistic about a dovish tone. that's what they're expecting.

joining us is hank smith. he is chief investment officer and on set with us is the deputy chief u.s. economist. let's talk about what we expect to hear. no rate hike. what's the most you expect to hear out of yellen this time around. >> i expect her to acknowledge to be vous thing the obvious things going on. risks related to -- i don't expect them to say international developments but there should be some hints that there are risks from overseas that could feed into the united states and i would look at this as her setting us up for december. with very a july meeting and we have hawkins before the september meeting so she has time to refine the message but there's not enough information for her to say i don't want to go in september and not any information that tells her she wants to. >> why in july? why are we assuming september. >> have you ever been on a conference call that hasn't worked quite right? >> yeah. >> i think if you have waited

nine years to raise rates you don't want to take the chance the conference call software doesn't work right the one day you want it to work right. >> if we're waiting for perfection, there may always be something that gives you a reason for why this is not the perfect time. >> it's like when is the right time to have a child? >> never. the world would have ended years and years ago. but that's an operational risk the fed can control. why would you take the chance to raise rates and go to explain yourself and not have anyone be able to log in. what are the odds that that gets out. if she sets up that call how early does steve have to be told he has to be available. >> so basically because the market is expecting september we're going to do what the market is prepared and setting itself up for. >> and everyone is going to be there and it will be a nice little press conference. i just think doing it in july is possible and certainly the fed thinks it has better operational control than most people would say the fed has but it's a risk and why add a risk on to the

policy risk you're already taking. >> i guess you are also looking at probably potentially lighter trading volumes in the summer so things could go a little more haywire. >> so as i said you know she'll talk in july. there's a meeting in july. there's nothing in august. absolutely nothing. so it will be interesting -- i think it's going to be the summer of summers on wall street with august just being pretty much as dead as it can be. >> we're not ignoring hank. we're having problems with this feed. >> his loss my gain. >> you get to talk a little more. but once we actually get to the point -- >> see problems with the feed though. >> exactly. things that happen. once we get to the point where we raise rates do you expect this to be a slow and steady situation? where you wait for a meeting and then another quarter point? that's what a lot of people have been saying. >> that's what the fed wants to do and that's the forecast. the risk i see to that is everything that they're targeting trends so they target unemployment. when unemployment falls it tends

to fall on a sustained basis. when wages go up they tend to go up on a sustained basis. the fed would like to go on a slow and steady pace but the reason it looks as it did in the the past is they target trends. >> the risk is although they want to go more slowly they might end up looking a lot like the 2004 rate hike cycle they keep discussing. >> what happened then? we've seen the dollar take off and strengthen. if the ecb is keeping rates very low with their quantitative easing program keeping things at zero there, what happens once we start to move particularly if the scenario you just layed out is what takes place? >> if we get the fact that the fed moves and hike rates that's pretty much priced in at ubs. as long as nothing changes in terms of who goes first. everyone expects the fed goes first and maybe the aing of england follows at some point in

the future. we have other countries that may follow us after us and the bank of england go but there's a pattern priced into the market of who is going and who follows and as long as that doesn't switch then the movement and currency should be limited. >> i don't know how much of this conversation you have heard but if drew is right and the risk is that if the fed starts -- once they start raising rates they'll have to continue to raise a little more quickly than they'd like to because once inflation picks up and wages pick up it's something you have to continually lead into if that was the case what would the market reaction be? >> i think the market reaction would probably be negative toward that. i think the market is pricing in exactly what the fed has implied so far that they want to raise rates in the second half of fall or early winter and that they want to do it gradually. that is priced in and any deviation from that would be a

negative surprise. >> it strikes me if that's the case you wonder why the fed doesn't start raising rates right away so they have more time to move slowly and deliberately. >> well look -- >> the argument being if you wait until you see the whites of their eyes you'll have to keep shooting very rapidly. >> in either scenario i think monetary policy will be characterized as still extraordinarily accommodative for quite a period of time even if the fed funds rate gets to 1% or 1.5% that's acomecommodateing in any scenario. that's good for the economy and ultimately fined for the markets. i think the key to successful unwinding of this monetary experiment relies on better fiscal policy. more pro-growth fiscal policy.

i don't see that happening for a couple of years. >> so you think it's going to be messy. >> potentially unlikely though. >> i'm confused. you think the key to unwinding successfully is better policy that you don't think is going to happen and yet you still think it will be okay? >> well yeah. i don't think there's a need to raise rates very quickly unless inflation gets out of hand we don't expect that or unless you see a draw matdic pick up in gdp and that's unlikely too. we're in this so-called 2.5% recovery and i don't see that changing too much until you get better fiscal policy. >> what do you think about the market in general? it's gone nowhere this year and some people think there's still a correction to come. other people think that this standing still has been the silent correction as we go nowhere and wait for earnings to catch up.

>> well look it's probably been pretty good that we have had this die jexwith the markets raiding at a narrow range and very flat. the equity markets still look more attractive than the fixed income markets and more attractive than doing nothing and if we get a pick up in the second half as we expect we'll get better corporate profits as well and we'll probably end up with a mid to high single digit year. that's pretty good. seven years into a bull market but this bull market can last much longer than the average bull market. much like the 1990s was a ten year bull market. we may be very well in a bull market like that. >> drew if greece falls apart as is on the front page of the wall street journal and financial times today continuing concerns about the deal likely this week what does that mean ultimately

for gdp growth? does it impact us or not? >> europe doesn't have the impact on the u.s. that you would expect. we do think this is going to get solved. it's going to go down to the wire but assuming it doesn't you'd have to look at europe declining. for every 1% drop it takes about a tenth off of u.s. growth. so it's a risk. you can certainly add up enough moves to get it to a point where it drives by enough but the bigger impact can come through financial market volatility. one of the reasons we had such a long expansion in the stock market is economic volatility is close to 0. so we have been able to grow but we're growing slowly but steadily and that would put that at risk. >> thank you for coming in today. hank it's great to see you too. >> good to be with you. >> another big night in sports last night following the

blackhawks winning the stanley cup, the golden state warriors winning the nba championship. his mother says that because it's easier to say. i'm told that the commissioner pronounces it that way. and then initially in the teleprompter andrew it was spelled, these people are iguondala. so they threw it in there just to make it interesting for me because they're back there typing not really out here but whatever. what do you like? >> i go with iguodala. >> it's just easier. i think that if you were going to be accurate. >> i want to go with the official pronunciation. >> okay lead the warriors to the

first title in four years topping lebron james and the cavs. the final score 105-97. i'm not happy with the npa because if you're going to start games at 9:00 i'm not going to see them. so this is -- i wanted to watch this year. >> but it's a california team. hard to be starting it on a time we would be watching. it's 3:00 in the afternoon if they put it on when we wanted to see it. >> 6:00. >> 3:00 in the afternoon out there. >> they started at 6:00 there. >> okay. maybe they could have. >> that's what you get when you get the chance to play your time zone. >> maybe even the cleveland game start but they have to -- >> yeah. >> and we have major league baseball and the nfl apparently is just around the corner. that's news that you can use.

>> coming up apple pie and now hacking the fbi investigation whether the houston assisttros network was breached. the hits runs and hacks of this story next. but first as we head to a break, take a look at this day in history.

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welcome back to squawk box this morning. tropical storm bill is now a tropical depression. the national hurricane center downgrading a storm. bill has dropped over 4 inches in rain in texas so far. the director of the u.s. office of personal management says that the agency is under constant attack from hackers. the director says that her agency has on average 10 million hack attempts a month. the attack on the opm exposed the personal data of millions of federal workers. >> all right. scuffing the ball corking the bat, steroids. there's always a way to get an edge over the competition in baseball and now maybe we can add hacking to that list. more on the latest scandal brewing in the major leagues and i get these weird updates on everything that happens. i get an update on my iphone and

i read it and i went say with a? it was just weird to see it wasn't it? >> yeah you remember that old saying there's no hacking in baseball. >> yeah. >> well maybe there is according to the new york times which broke the story yesterday. officials are investigating whether or not the st. louis cardinals broke into a data base maintained by the houston astros. inside that data base were some of the most valuable assets. that is statistics and details and 0s and 1s about their players. potential trades. dollars and cents. all of that very valuable these days. the new york times which first reported the story said it might have begun when an official left the cardinals and went to the assist astros. it may be the case that folks at the cardinals organization looked up his old passwords into the cardinals data base and

tried to use the same passwords to get into the astros data base. if you change organizations you might want to change your passwords as well. we have statements here from all of the organizations involved starting with major league baseball. it is aware of and fully cooperating with the investigation. the astros say they're actively cooperating with the investigation as well and the card nals say they are aware and cooperating as well but it's not appropriate to comment further at this time. this is obviously going to be a big problem for major league baseball going forward. one of the questions is what will they do to the cardinal's organization in these allegations are born out. is there a legal problem or league wide problem and where are we in this era of cyber security. >> it sounds like this was a one off when i started reading details and you mentioned they

were trying old passwords. completely unsophisticated. >> this is what cyber security experts call an unsophisticated attack. somebody used the same passwords at two different organizations and that's just a no no in terms of cyber security. >> i always watch these stories and think about my own passwords. and i know you're using your birthdate still. >> who is going to figure that out. >> the kids names, all of that kind of stuff. we have to come up with some new -- >> what's not clear here is what exactly the cardinals would have gotten from the astros data base and if they were able to make use of the information. one of the weird pieces is that some of the data ended up being posted anonymously online at one point. so they were aware that something leaked out of their data base for awhile now but this question of whether or not it's the cardinals is a new piece of this. >> sounded like the cardinals are trying to think if they had

taken any prone taken anything from the cardinals. they were spying to see if he had stolen anything. >> it could be this is defensive spying. the cardinals were spying to see if he spied on them. >> that he had built for them to begin with. >> right. >> and there's two questions. one is the legal consequence and then sort of the baseball consequence if in fact this is found to have actually happened. it actually happened i know. but it's another team like this. >> the facebook consequence is going to be the baseball owners and the management of the league. the legal consequence will be straightforward for the fbi. and if they can establish that and who did it then they just use the federal statute and state and local statutes and prosecute people for computer

climbs. >> they go do other stuff. >> this is a big business joe. ultimately these are multimillion dollar videos. just because it's baseball doesn't mean there's not real money and real business at stake. >> i don't know, maybe if they check those thousand people that are glued to the in the u.s. i'd rather check a few of those people out maybe. i don't like the cardinals. they're a great team but they have hurt my cincinnati reds a lot in the last ten years or so. they've been really good. in fact i think one -- they no hit the reds in the first play. i was excited -- that's my life. i was excited to watch the playoffs. >> and they didn't do that with stolen data did they? >> i don't think so. first game no hit. it's going well. coming up the stories that have you squawking this morning including a snapchat lesson for

parents and some encouraging signs for the millennials. and stock picks from the successful investor and plus target chairman and ceo. first as we head to break here's a look at yesterday's s&p 500 winners and losers.

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big day? ah, the usual. moved some new cars. hauled a bunch of steel. kept the supermarket shelves stocked. made sure everyone got their latest gadgets. what's up for the next shift? ah, nothing much. just keeping the lights on. (laugh) nice. doing the big things that move an economy. see you tomorrow, mac. see you tomorrow, sam. just another day at norfolk southern.

>> welcome back to squawk box we're in the chairs this morning. i don't really know. except that it feels like christmas this morning. but nonetheless, we're talking about some of the stuff that caught our attention. one of those things is a youtube video that evan spegel put together. a lot of times companies put together fancy elaborate videos showing how their products work. evan did the opposite. he set up in his kitchen and decided to explain to people like my mother how snapchat works. >> instant expression changed that because it says my i denty is who i am right now. it says i'm the result of everything i've ever done but i'm not really the accumulation of all of that stuff. >> what is he talking about? how does that relate to how it

actually works? >> he does go through -- he tries to eckxplain how the internet works and snapchat works and it's actually kind of helpful oddly. >> i like the flowers. >> you don't have to throw your mother under the bus. you don't have to look any further than -- >> myself. >> than me for explaining. kids use it a lot. because it disappears. >> but it's become a communication device. it's how younger people -- >> was that the guy -- i remember the other day that we had with the t-shirt. >> the same guy. >> yes but that's even a crappier looking t-shirt. >> but it could be a $180 t-shirt. >> but it looked like an undershirt. >> god bless him. maybe he's a little stingy that's great. >> it doesn't look like the first time he's worn it without

swash washing it. >> i have hopes that millennials don't keep going further and further out the, you know into lala land. this makes me think maybe they do come back a little bit and maybe the world doesn't totally change from what i knew my whole life. they go to walmart. they shop atwal mart. it's the hottest big retail with millennials and it says here now that a lot of them are actually starting to have kids and they have time crunch they have relationships, they need a place for one stop shopping and some people didn't even believe it but then info scout with a nationwide panel of 175,000 shoppers, the walmart index is higher with those under 24 and then target, costco kroger whole foods. i thought they hung out at whole

foods. >> that's a whole paycheck. >> walmart has done a lot also to improve it's image to make sure sure that it's done things like waging minimum wage. >> can we show some video of the walmart shopper again? there was maybe one person in the images that could have possibly -- that's not a millennial right there. >> there was a kid there. >> would that count as a millennial? >> no. they have a different name. >> that's a millennial. >> and 25 to 30 -- and shoppers was better. >> we have target ceo. he will be joining us later this morning but joe the story plays into the story i have been taking a look at too because finally for the first time since 2007 americans are having more children and this is the millennials finally coming around. it's never a great time to have

kids but when you don't have a job or home that puts off the birth rate. now the numbers are small. the advances are very small at this point. for every 1,000 women of child bearing age there were 62.9 births up from 62.5 births. if you look at the statistics how many kids every woman is likely to have over the course of her lifetime 1.862 kids. but that's still below the children every woman needs to have in order to keep us afloat in terms of demographics. >> i like how you say that. 62.5. >> you just wonder with the .1 what part would bit. >> this explains all the babies on the planes recently. >> that you've seen. >> that you've loved and enjoyed. >> i love babies on a plane. >> you're both still young enough. >> everybody wishes they had more right? >> everybody wishes they had

more except -- >> every man wishes they had more. >> except when you're on a golf course because you have a four shower some if you have two kids. it's just that cars you know you don't need the third backseat necessarily. two and two is pretty good and then going back -- >> i'm at two right now. do you think we should go for three. is that what you're encouraging. >> i would. >> on the air? maybe she's listening. >> she's going to be mad because you know what it would mean. i don't want to throw her -- >> maternity clothes. that's what you're thinking. >> no close contact. you know the whole nine yards. >> yeah the whole nine yards. she's like never again. >> i think she comes out on the opposite side of that debate. >> do tell. >> coming up wearable devices are -- we're going to break now. but is one of the makers behind

them fit to go public. the street view on a fitbit ipo but first check out the dollar. squawk box returns in just a moment.

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>> welcome back. take a look at the u.s. equity futures. they're higher once again this morning. this morning it's indicated to open up by about 60 points. s&p futures up by 5.5 and the nasdaq up by 11. >> fitbit set to price it's ipo tonight and will start trading

tomorrow morning. the company just raised it's prices and are offering the shares between 17 and $19 per share. here to talk about it is alex hamilton. the senior analyst at spqr capital. >> good morning. >> you look at a company like fitbit. valuation of $3.7 billion. does that mikake sense to you. >> it makes a lot of sense. it's in line with it's peers and it could argue for a higher prul premium. >> but can it continue to grow as fast as it is and in an age of smart watches, and i'm not wearing one, but an apple watch i'm thinking about, do these devices that just tell you how many steps you've done or how much you've slept, actually s there a market for that? >> well obviously that's the golden question. >> long-term. >> the ipo is going to be hot. no ifs, ands or buts about it. what does this company look like

out three to five years? we would say it's a growing business. they grew 300% last year so that's the first thing we would say. there's a large enough market where there's a slice where they can exist. who knows who is going to acquire who but the functionality and ecosystem is great. one of the reasons we like it is management team. we can talk about valuation and the 85% market share but the management team is very impressive to me. they're very strategic and pouring a lot of money into rnd. what's the best defense? a good offense. they're very smart. they're building an ecosystem which as we know is what apple has done well. >> is their product defensible in that apple is now -- the functionality in an apple watch is relatively similar to what's in that device. >> it is. >> right?

>> it is. >> so if you have apple and google and everybody else out there are they going to have a watch? do you see long-term them having a watch that competes with apple? >> they may. the whole thing is i think the fact that we're having this conversation and that this is the big question that's asked is apple watch is going to be the category killer actually raises awareness of it and a lot of people are going to go oh let me go buy this fitbit or the am watch. at some point does apple buy these guys or buy someone similar and bring that functionality in house, don't know compare this to jawbone. >> all we know about the lawsuit is over the last two month employees came. one was a cost accountant so the question is how many ip does a cost accountant have? these guys have a much larger

market share and that's a function of the ecosystem and being able to use it easily. >> finally privacy. one of the big issues is there's a big brother element to this. fit bit has your information for now and long-term whether it's fitbit or jawbone or apple watch or whatever do you think your insurance company will require you to wear one? you'll be sending that data back to them every single day and lit change the premium on your insurance product or your employer will require you to have it as a key to get in instead of having a key card? >> this is all something that they're pushing. get them to have it and your health care comes down. that's the wave of the future. big brother is watching us all the time. >> you don't think the public is going to ultimately reject that? or do you think there's a steady

march -- >> i originally thought they would but they seemed to be accepting it more and more. >> right. okay. alex thank you for joining us. we'll see where the ipo lands tomorrow morning. >> okay. thanks. coming up -- the phillips doc holiday, remember the no-hitter but we have basically lost everyone recently. >> but we still stink but the phillies are so bad this year. but that was just 2010 and we lost to the giants after winning the first two games we lost three straight and then the pirates we folded. >> things turned quickly. >> you know he loves the cardinals and i gave him that sign stuffed with bob gibson and i sent it out there. >> did you send it to warren. >> warren. he loves the cardinals. stan and bob gibson and the third guy. he was on the thing. the ceo of a company that makes products that heel wounds and burns. here's the interesting part the materials are processed from

human amniotic membrane. the story of the bio tech company. when we return. but first as we head to break check out the price of oil which is above 61 now. stay tuned. squawk box will be right back.

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>> welcome back to squawk box this morning. just as uber created the world of on demand drivers amazon wants to enlist every day americans as curouriers. they're developing an app called on my way. it would pay ordinary people to drop off packages on the way to other destinations. the move would help manage wruzerswruz users shopping experience. they would also store the packages so joe if you're headed home you can tap the app and make a little extra money by picking up a package and dropping it off at your neighbors house. would you do that becky? >> turn it around. would you accept the package. >> i would. >> so instead of having a ups

guy. >> so if you order from fed ex or amazon anybody else you get a stranger that delivers. >> i know my fed ex fedex guy. at least they have the brown clothes on or whatever it's going to be. now it's going to be a random guy in a car pulling up to your driveway. >> maybe not. i do know the two guys who show up at our door constantly. >> let's talk here. i'm focusing here on something very interesting. here's another high flying biotech company you might not have heard of called mimedx. it helps wounds heal two to three times faster. the chairman and ceo is pete peteet. he's in town for the weekend. he's stopping by "squawk." who has the most trouble with wounds that don't close within 6

to 12 weeks? diabetes? >> generally they're diabetic patients. there's a huge population of those. and their body's compromised. it's very difficult for them to close. >> they're using foot or leg uls ulcers ulcers. >> right. >> if you don't do anything in 12 weeks you can get 30% of the wounds to close. with this you get 90% to close within six weeks. >> that's why there are so many amputations, right? >> that's correct. correct. often if these wounds are left they'll remain unclosed unhealed and they get larger and larger and turn into amputations. >> it turns out the amniotic membrane you can get from a placenta, you found a way to keep the important proteins in that tissue and then you collected and you put it on the

wound. >> that's correct. a very prolific organ. there are over 80 proteins in there which are growth factors. and when applied to the wound, they enhance healing, they reduce scar tissue and reduce in inflammation inflammation. >> is that the easiest way to do it? the easy way? >> it's a whole menu of all 80 that work together. we don't understand how it all works. >> you've had a baby. i've been there. i've seen a placenta. i've seen 'em. i don't like 'em. >> they're not attractive. >> and normally the hospital throws them away. medical waste. >> exactly. >> so you go in there and say, hey, what are you doing with that placenta? and they say, we're just going to get rid of it. >> there was a trend people were eating them for awhile. >> i know i know.

that's also part of why i'm chafing here. >> small trend. >> yes, small trend. so you go on and say -- you collect them. you collect them from hospitals. >> we do. we contract with hospital staffs there. >> they're like sure go ahead, take it. >> saves them money and it's a good public relations aspect to it. >> you do that on a large scale? >> we have it across the country. we have hospitals across the country and continue to add. >> do you effectively have to buy the placenta? what does it cost? >> first of all, in the u.s. you cannot sell your tissue. it has to be donated. so we reimburse the hospital normal cost of helping us in the process and doing some testing and things like that. >> you've been involved with biotech -- you've even funded georgia tech for biotechnology. >> that's correct. >> research and everything else. and you've done -- how many public companies have you run? >> three or four.

>> so a million dollars in sales a couple years ago. and this company sold how much of this stuff? you sell $170 million? >> $120 million last year. moving to $180 million this year. >> i don't see why -- is it really proprietary the way you preserve the tissue to make it work? >> well we've been doing this for over eight years. we have 20 granted patents, 70 patents under review. and we have proprietary ways to process this. there are competitors entering the market somewhat fairly rapidly, but we've got a huge lead and expect to maintain that lead. >> does cms reimburse this? is this something that medicare will pay for? >> we do. we've done a lot of clinical tests and scientific tests over the last few years. we've got all to invest. >> better than what it takes to fix it some other way, right?

much cheaper. >> absolutely. and it's proved to be cost effective. >> what about those who don't heal? people with compromised immune systems or something? >> absolutely. bed sores. national tragedy bed sores. horrible problem. and paraplegics, horrible problem. we're showing excellent results. >> you have to go through fda approval for this? >> not as long as our position feels like the necessary use of the product is healing, enhancing, reducing scar tissue. they can use the product. >> what does it look like? >> it looks like a piece of wax paper, actually. it looks like a piece of wax paper. >> that's it? >> comes in various sizes. >> how much does that cost? >> they range in price from $300

up to several thousand dollars depending on the size of the wound. >> pete thank you. >> my pleasure. >> >> who's better? university or georgia or georgia tech? >> i have on my gold tie. that ought to tell you. >> there's a rivalry there, isn't there? >> it's called clean old fashioned hate. >> thanks for coming in. >> my pleasure. when we return this morning, we'll have more of today's top stories. plus ron baron is in the house. find out where he's putting his money to work right now. stick around. "squawk box" will be right back. .. right here. with a control pad that can read your handwriting, a wide-screen multimedia center, and a head-up display for enhanced driver focus. all inside a redesigned cabin of unrivaled style and comfort. the 2015 c-class. at the very touchpoint of performance

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squawk market master ron baron is here. he says right now is the time to look for investments.

he'll tell us where he's putting more than $27 billion to work. top performing manager in the squawk platinum portfolio is ditching his best-performing stock. we'll tell you what kevin landis is adding and why he's getting rid of netflix. and call it the infant indicator. >> i want to have a baby. >> you do? >> a trend in the u.s. birthrate that we haven't seen since the beginning of the recession. more babies. >> i think if we got a kid to love, it'll teach us how to love each other again. >> that story just ahead as the second hour of "squawk box" begins right now. ♪ live from the beating heart of business, new york city, this is "squawk box." >> oh. welcome back. talking to ron baron about venice. nobody goes there anymore. way too crowded. anyway, we're on cnbc first in

business worldwide. it's 7:00 a.m. i'm joe kernen along with becky quick and andrew ross sorkin. i did say ron baron is on set. one of the great long-term investors. made gazillion dollars. how much is that? >> how many zeros? >> i'm not even sure -- is it a -- i don't think ga zillion -- it's a technical term. >> it's a thousand trillion. >> a google's got to be more. >> a google is definitely more. i knew that. but i don't know if a gazillion -- anyway. he's loaded. anyway u.s. equity futures at this hour are indicating more advance after the last couple of weeks have been sort of characteristic of the year. a lot of sound and fury and we're up 1% on the s&p, down on the -- right around only on the dow jones. and we got one of the reasons for that no one knows when the

fed's actually going to do something. it's not going to be today, probably but we will get info today. then you've got do we say grexit has got more likely? instead of being a 20% chance is it now a 30% chance? >> it's getting later and later. >> to 30% or 40%? >> i don't know that the percentages have changed at all, but i think the situation is more stressful. >> people are starting to think it's a possibility. >> we've gone a longer period of time. >> and they seem to be saying you know the hard line they were taking -- they've had a chance to think about whether they want to pursue that hard line. >> i read something today that suggests that if they don't get a deal by next week they're in a situation where you could see some real capital controls put in place. because there could be a run. the money leaving. >> i like their language that the idea -- >> criminal imf? >> that the germans -- look. we have no money.

we spent it all. and if you're not going to bag us out, i mean that's criminal. it's just being too mean to us because we don't have anything. but you're the criminals by not giving us money we already spent. >> i like what walter isaacson brought up. the idea of the way to do this would be to issue them the same sort of money that they want to give the imf. issue that to the pensions and say here's a credit. maybe it will be worth something if you hit these reforms. if you won't, it will not. >> the humiliation of our people, we are denouncing the eu or german's humiliation of our people asking them to stop spending money you don't have. right? am i wrong? >> no. >> just bizarre. we've got to do top stories. i just looked it up gazillion, there isn't -- but bazillion,

sextillion -- >> like with zimbabwe with their currency you needed quadrillion. when you put a helmet on gazu does exist. >> it's a good look. >> starting the forbes 400 to get on it with $75 million. and it's now -- there's more than a hundred people who have over a billion dollars. and they didn't make the cut. so what it means is there's inflation. and there used to be a few billionaires. there's now 500. >> ron, the right-minded politicians of today are going to take care of that. and there's going to be no more of this wealth creation. if we can, we're going to try to take those people right the hell back down to $70 million at the moment because no one needs more than that. we're working on it. the left is working on it right now so stay tuned. right, andrew? >> i heard that. >> yeah. just relax.

we're going to cure that horrific societal ill. >> in the next two hours. >> right. >> in the meantime we've got our top stories of the hour. we're counting down to 2:00 p.m. eastern time. that's when we'll get the fed's latest policy statement. just a half hour before janet yellen holds a conference. a rate hike could happen before the year's out. of course you've got to stay tuned for up to the minute coverage from the central bank. >> down to the second. we know when they're going to say we're not doing anything. >> we're not doing anything. so stay tuned for that. keep your eyes right on that. >> we've got that going for us. >> i watch your program every morning when i'm working out and all -- >> volume off? >> volume's on. >> god bless. >> and all the news you have is about what's happening today and what does this mean for the stock markets. and the way i see what's happening is that there was just a report that came out i guess a couple weeks ago called a motley

fool. and the motley fool said, you know, the 22 most important investment banks in the united states since 2000 they have strategists and they rank predictions all the time about what the stock market's going to do and what the impact is of the news we discuss every single day. and what the -- you know everyone said there's going to be a correction. so everyone makes these projections. yet according to motley fool all these people spend all these millions of dollars over the past 15 years, these strategists have been wrong by an average 14.7% a year. so 147, 1,470 basis points a year. and the stock market since 1960 has gone up, the economy's gone up 6.8% a year. and you add 2% for dividends. you would have been 9.5% a year. instead you used a blind forecaster. you would have been wrong by 1400 basis points.

if you make all this money and effort and figure out what the greek exit is going to mean you would have been wrong by 1400 basis points. so everyone's trying to predict what's not predictable. and spend all their time. every time he thinks about the market it's a wasted minute. >> in other words, don't worry about timing the market. just look at the market as a constant opportunity. >> yeah. well not constant opportunity. the stock market is closely aligned to the economy. and if you think about it in terms of gdp and dow jones, that currently the dow jones is 18,000 and the gdp is 18 trillion. and you go back to 2007 and it was 14 trillion and it was 14,000 on the dow. and you go back to 1960 and the dow was 600 and the gdp was 520. so they're very closely aligned all the time. and now the stock market is 17 times. it normally ranges between 10

and 20. interest rates are as low as they've been and economy is getting better. everyone is worried about whether the market is expensive or cheap, but really the stock market -- the economy's doing fine. and the stock market's doing fine. >> we were going to do headlines, but that would be considered noise in ron baron's world. so we're not going to do headlines. we'll continue the conversation with ron. >> you know what? we can certainly cut down on our staff. do we need anyone at all at this point, ron? should we even produce the show? >> i think the guests you have on -- >> with your answer think about us. we want to stay here. if we can. >> the relevance is i think what's most important is to inform your viewers about what the government programs are which you talked about at the very beginning about gazillion dollars. that's really important. and the important aspect of that is that it's about inflation. and so the government program is all about trying to create inflation. people don't think there's inflation right now.

they think there's 2% or 3% and not even that. i think there's 4% inflation. and everything you look at costs more than it did a year ago and the year before that and the year before that. >> why don't you think the fed is behind the curve though? >> the fed is doing exactly what they want to do. they want to devalue your money. and they want to keep the rate of interest below the rate of inflation. so i analogize it to my parents when they bought a house in 1955. they built a house in 1955. it was $20,000. and they did it with a $15,000 mortgage and my dad in 1955 was making $10,000 as an engineer his rule of thumb was you can buy a house twice as much as your salary. but that house today is worth $300,000. it cost originally 20,000 worth $300,000. that's not trouble. you have a $15,000 mortgage on a $20,000 house, that's troubling.

so devaluing, degrading the value of our currency making it less relevant less important. >> you think they're doing this intentionally? >> absolutely. >> they know that really if you're looking at inflation, if you were looking at what the fed would normally be doing, you would have raised rates already? >> probably. but the country's too leveraged. so this same thing happened in 1929. >> we'll pay it back with less. >> yes. and so to make it smaller relative to the size of the economy. in 1982 debt was 140% of gdp. it got up to 300%. it's now 340%. then it came down and stayed low for a long time. 140, 135 130, 150. then in you had a big increase in the size of he economy which

was generated by people borrowing to make businesses grow. and that wasn't good growth. so now we have to make that debt less burdensome. and if you had interest rates going up to what their normal thing would be people couldn't afford to pay the debt. >> does this experiment work though? does it work and can we get out of it gracefully? >> in the 1940s you had this big inflation. you're having that inflation now. everything you look at everything you get into a taxicab, a subway an uber. you pay for your kids' tuition in school. i was asking people in my office yesterday about what does it cost to buy a big mac. they said it was $5. when i was in law school it was $1. and then the minimum wage just raised in california to $15.

when i was in school it was $1. tuition was $3200. it's now $45,000. so the idea the government has is to continue to make people who have a great deal of wealth they don't want to just sit there and be kavn jers. they want to create a strong middle class. say rich people you can take care of yourselves but we're going to tax the heck out of you with inflation if you don't take that money and invest it and build businesses and create jobs. we're having you invest. we want to invest in companies that are making themselves become larger. by investing in their businesses to grow and to create jobs and to make themselves a much bigger company in the future than they are today. most people when people talk about i'm going to go out there and hire salesmen and invest in rnd and much bigger business the stocks go down.

they're taking money out of profits to invest and make themselves become larger. the government says wait. that's what we want you to do. but most people are afraid to do that because they have these really cool jobs and don't want to lose their jobs by penalizing their profits and having their stock prices go down. >> what does that mean about valuations in the market right now? you've come on at points and said this is a great time to buy. we've come a long way since you made that proclamation. >> people are afraid. they're still afraid otherwise stocks would be higher. people say if interest rate gos up wouldn't that mean the multiples will come down? the multiple is normally 17 times. the economy is getting better. interest rating if people thought they would remain as low as they are, stock would be 25 or 30 times earnings. so the market is priced in already that interest rates are going to go higher. they're not going to go higher real fast. because if they did, we couldn't service our debt. >> sit cheap or is it -- you're

saying it's not expensive. >> it's average. it's right in this range. and it's in the range at the time when you have this tremendous stimulation in the economy. you have oil prices beating down so sharply compared to where they were. that's a huge benefit. to have debt come down from the deficit. $500 billion a year. and here in one -- and everyone says how stimlative it is to borrow money and spend it for the government. and here you have a stimulation going on in the economy. you now have 800 -- >> there's something called big mac index, ron. >> the economist does it. >> yeah. and it's in every country. as you said $4.79 currently in the united states. in the ukraine, you can pick one up for $1.20. >> a big mac? >> yes. >> in hong kong it's only $2.43.

in china you can still get a deal on a big mac. $2.77. but ukraine, if you love big macs, a bomb might drop on you or something but it's the cheapest place. switzerland, most expensive. $7.70. >> because of what they did, unlocking the currency. >> probably. >> fortunately ron is going to be with us for the next 15 or 20 minutes. and we have a lot more to talk with you about. >> i want one thing before you go. in the 1950s there was a television program on called the millionaire. and the millionaire was about this very wealthy, you know person, and he would give a million dollars every week to someone who he didn't know and it would change their life. totally change their life. and they would spend it or quit their jobs. or they would do all sorts of things. that was a million dollars. and now a million dollars, you

know, that doesn't change people's lives. and so again, it's it's the million dollars and when we first got -- when i first met my wife in 1976 in 1970 she met somebody on the street and after that person left she said that guy's father is a millionaire. i'd say, a millionaire is not a millionaire. tough have $3 million to be a millionaire. and to be a billionaire, who the heck knows. money keeps to getting to be worth less which is how the government is trying to make the economy grow. >> we're going to talk stocks specifics with ron when we come right back. also later in the program, hacking in baseball. the st. louis cardinals under investigation. then congressman jeb hensarling. plus the top performer in the squawk portfolio is here. kevin landis announcing a change in his most profitable pick. "squawk box" will be right back.

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they have the most free on demand tv shows and movies on all my devices. it's perfect for me because my kids are costing me a fortune. i'm going to cabo! ♪ don't settle for u-verse. xfinity is perfect for people who want more entertainment for their money. welcome back to "squawk box" this morning. a deal in the pharmaceutical industry. allergan buying kythera bio. they specialize in cosmetic treatments. also in health care technology company, hill-rom is now buying welch allyn in a little over $2 billion in cash and stock.

>> i knew that brand i think. i remember beds. beds that go -- in hospitals. back to our discussion with buy and hold legend ron baron. some of his big picks. like manchester united is one that they have here rb ron. how long have you been in manchester united? >> i think about three years. three or four years. >> and it's snup. >> made very little in it so far. >> why do you think -- >> made over $10 million in it so far. >> yeah but it's a $200 million investment. they were doing about $600 million in revenues and making $150 million a year. instead of making $600 million of revenues we'll make $1 billion in cash flow and the company will be worth $6 billion instead of $3 billion. and the reason we think it's interesting is because we view

this as opposed to people thinking about it as a rich man's toy. and the super bowl gets 110 million viewers once a year. this is the most popular, most viewed soccer team sports team in the world. and $2.6 billion. and they do 40 games a year where each of those games has viewers of 40 million people so they have something like for this one team. 40% or 50% of people who watch soccer watch it because they want to see manchester united win or lose. it's a television program. it's live sports. that's why espn is so valuable. you can't time shift it. you watch it when it's played and that's the value of this company. here with the new management team, these are the people who own the tampa bay buccaneers

they bought. the same idea here is that there's, you know a tremendous fan base. the l.a. dodgers sold for $2.4 billion. they had fans of i guess 5 million fans. the yankees have 15 million fans on facebook. these guys have 50 million fans on facebook. they're just beginning to monetize that for licensing and everything there. >> are you like beating the bushes for i would think things that offer live content. because it's not just sports but it's any content that you have. content that can be viewed any time might be hard to monetize. but anything live content are a couple steps ahead of the game, aren't you? >> live content sports. >> not just sports. but the stock markets open during the day and you can't replay cnbc. then you'd really have a problem

if you're watching repeats of cnbc. >> that's very true. just like sports. >> i would even think news can be viewed later, i would think. i mean it is time sensitive, but not as much as business probably. >> yeah. but we have 450 investments. there's so many ideas. >> give me some more. besides man u. >> well a couple companies i was just telling you when i went to israel i visited mobile i. and that's autonomous driving. this became public a year and a half ago. what's interesting about this company is the guy who is the chairman driving around in his car in israel and this car drives while he's reading a newspaper. people are honking at his car. but the car is driving all by itself. and this -- >> it's legal there? go wherever you want? >> not everywhere but the regulations are coming.

to hear they have a are testing in -- they have the data. and they've been collecting this data for i don't know how many years. 13 years. took them three or four years to get to profitable. now it's a $300 million business. in the united states there are 35,000 deaths a year because of auto accidents. around the world i think there are 1.5 million fatalities a year. there's 75 million people who are injured a year. there's 1 trillion a year of economic damage. this guy has a monopoly. this is like microsoft and intel. >> from a technology perspective, there's knob else that comes close? >> all the automobile companies are gathering this data and the data is given to our guy. and he gives the chip to the automobile companies for $50, $60 a chip. now it takes eight years to get these chips into cars.

and they've got a 90% share when they went public. now they have 100% share. you can't get this data from anyone else but them. so the roads, when there's a tilt in the road these guy wills know about it and they'll be able to have the car steer a certain way because they collected millions of miles in traveling. the chips go into cameras. cameras are put into the cars. this chip is very valuable. if you get $40 for a chip it keeps you from crashing into -- from staying the lane. then you pay $60 for a chip. and then it recognizes cars. and $70 recognizes people. and $80 recognizes signs. and $90, you know keeps you on the road by itself. and then $120. so it's a very small amount relative to a car price. and the regulator are going to require all these cars to have it. and these guys have essentially a monopoly and will for a long time. that's one idea.

and so with a trillion dollars, this company in ten years could be doing $5 billion a year revenues and making $5 billion a year in profits. >> ron, can i ask you about a stock you don't own anymore? winn. you've even brought steve wynn on the program with us. why'd you sell? >> we invested with steve between '80 and '83 and tripled our money. and then in 2001 we were one of the three investors in wynn that was a founder of the company. invested $20 million and went public. that was at $20 a share. went public at $13. we invested $135 million at one point. and we got back about $70 million of dividends. made $88$800 million in profit. the reason i don't own it now is it was owned in our firm at small cap funds.

we still well under 20. and then between 100 and 150. and then it was in small cap funds. we still owned for sentimental purposes. then all the things started happening in china and it was too hard. we only owned a million shares at that point. and it wasn't any longer in the small cap funds. it's too hard to figure out. i think it's attractive at these prices. but he was great and made us so much money. he was introduced to me by jay pritzker when i was interested in gaming. but i got so many other ideas. tesla. >> netflix still? >> no. >> you never did get in huh? >> so little and so wrong. >> but you're a buyer of tesla. >> i love tesla.

i think we're going to make between 10 and 20 times our money in the next ten years. tesla is a huge opportunity. in addition to the fact i love battery cars electric cars and when you drive that car, there's a reason why their car is chosen by all those automobile magazines as the best car they've ever driven. it's a better car than everyone else's. the idea is when you drive a car, it's about the center of gravity. joe, i see you driving sports cars all the time on television and you think they're terrific and they wreck up the environment and everything and they feel cool. but have you ever been in a tesla? >> i've driven a tesla. >> what did you think? >> i didn't drive the new one. i drove the little roadster. i couldn't even fit in it. >> i didn't either. >> you've got to charge the batteries with everything full.

>> natural gas and solar. >> well natural gas is still -- >> here's the deal. when you drive a conventional car, the center of gravity is not in the center at the bottom. >> unless it's a mid-engine porsche. >> yeah. but that's not a great car. i used to have one of those. >> did you sfll. >> but the engine is in the front. and the gasoline slushing around in the back of the car and could explode at any moment. >> i don't know about that. we had to redo "dateline" because we said that once. >> but the battery is bottom of the car, exact center. so the center of gravity is centered. and when you think about them being able to have an opportunity, they're doing this year they're going to do 55,000 cars. last year 2032. they think they're going to do half a million cars a year in 20 to. and i think they'll do it a little faster.

the idea is 2020 they're doing $5.5 billion in revenue this year. by the end of the year $10 billion. by the end of this year $10 billion rate. in 2020 they're going to be doing, you know $35 billion, $40 billion making the profit. the company is now valued for $30 billion. so i think that it's going to be valued for $120 billion in four or five years. and in ten years you have another behind that. >> ron, thank you so much for joining us today. it's been a pleasure. >> come on back. >> next time stay a little longer. >> so many more things we want to talk to you about. >> thank you for inviting me. >> fedex numbers are hitting, ron. i don't know if -- >> investor of fedex? >> in the beginning of my career. that's one of the things that made me be a long-term investor. making double triple then 50 times. >> wow.

>> we got to wait for the clean numbers to come out. because there's obviously some charges involved. because the net number that they're reporting is a loss of $3.16 a share. if you adjust it though it was $2.66 a share. so $2.66 a share is the clean number that we're going to compare to analyst expectations. and the revenue number is $12.1 billion. that's $2.66 is 2 cents below where $2.68 was. this is a fourth quarter number. looking for $2.68. then $12.1 billion is above -- actually, it's slightly above. $12.3 billion was the average analyst consensus. for revenue. >> the raw number included charges for previously announced issues including charges in pension accounting aircraft impairments, legal reserve increase, and segment reporting.

these are all things that had been announced earlier. >> i'm just looking. a lot of times you don't get a nice -- they don't necessarily give you an outlook. but this is the fourth quarter. so we'll be looking at any comments for what the company sees for fiscal 2016. >> they're looking for $10.60 to $11.10. >> drive a fedex truck. $10.88 is where the street is right now. >> they also talk about capital spending for fiscal 2016. they're looking for $4.6 billion. they say that includes the fedex network and aircraft deliveries. >> wow. i like this. how old is fred smith? >> oh you saw this? they're going to increase the mandatory retirement age from age 72 to age 75. >> still too young. >> david steiner independent director says the change is

consistent with the market trend of increasing the mandatory retirement age for board members. we should look at the age group of the -- >> we haven't even mentioned that. >> 98 years young. >> and he was one of the greats. two or three years ago walking around in his suits looking like a million bucks. i guess that kid wasn't his, but for awhile we thought he was getting it done at like 89 or something. look, if there was a question as to whether it was his or not. >> very flattering right? >> he was still getting it done. still working. >> fred smith by the way is 70. >> i'm trying to see who's considered an independent board member who is going to be passing that 72 age. because clearly that's what this is for. >> i'm all for that. >> we will try to figure that out during the break. ron, thank you for being here. we loved seeing you. meantime coming up treasury secretary lew on the hill. questioning him about the threats to financial stability.

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welcome back to "squawk box." when we last left you we were talking about fedex which came out with some numbers. but in addition to that, they increased the age of retirement for some of the board. we were questioning before we went to break who that might be about. 72 to 75. fred smith we decided 72 years old. james barkdale is 72 years old. he will of course remain on that board. remember netscape?

>> i do. i still use it. i have it on my commodore. the stock was down fedex. it's coming back. it was closed at 182. >> we're going to get to mr. hensarling. secretary lew appearing later this morning to address potential threats to u.s. financial stability. the committee maintains the low interest rate policy is among those issues arguing that it introduces dangerous imbalances into financial markets as investors reach for yield. joining us now is representative hensarling. he is the chairman of the finances committee. thank you for joining us this morning. >> thanks for having me. >> i imagine you're going to grill them on this issue. but the question that i would like to ask you is when you think about the volatility that you're suspect arguing is the

result of fed policy how much is a systemic issue to you and how much should she government be involved in that? >> well i think there's a lot of issues that help create some instability potentially in our markets. i think we know that we have all investors who are reaching for yield. we know that there are potential asset bubbles within our economy and what we would hope is that fs sorks c would recognize the federal reserve needs to look at a more predictable rules base policy and that we can't sustain the interest rate policy that we have now. but is in many respects a number of learned economists would argue it was this artificially low interest rate environment that was one of the causes of the housing crisis in the first place. and so we have this fsoc that at least with identify some of the

potential instability within the financial markets that just won't go to the source and a lot of the source is federal policy for example, the volcker rule leading to all types of liquidity in our fixed income and corporate bond markets. when the fsoc is given a direction into stability and to make recommendations, unless they source it you can't do anything about it. we met the enemy and they are us. >> i understand looking at rules like the volcker rule but i also wonder about politicizing things like the federal reserve in terms of how it approaches interest rates. and so are you looking more at -- when you talk about rules-based issues is that what you're talking about? or do you actually want there to be a reduced based approach to interest rates? >> well in the last congress the financial services committee passed legislation that would simply make the federal reserve less opaque. my reading of economic history

and that of many economists is when we have a predictable rules-based policy that the market understands, the market knows. that's associated with periods of greater economic growth. no i don't want to politicize the fed but given they have an independent budget i'm not sure just how threatened the fed should feel from the united states congress. but what we're asking is come up with any convention, come up with any approach you wish. change it deviate from it but come to congress and testify in open hearing about what you're doing and why you're doing it. the fed does not have a monopoly on smart ph.d. economists. . they have a good methodology, it ought to test -- it ought to be tested in the court of public opinion. and today it's not. >> we want to turn our attention right now to the talk of the bailouts. i wrote about it earlier this week the aig decision.

i want your thoughts on the decision and the implications of the decision. many have suggested this will make it difficult for the government to pursue a bailout in the future especially when you tie that decision with dodd-frank. where do you stand on that? >> andrew one, i'm not a real lawyer. i'm a reformed lawyer. i haven't read the court opinion. but i will say this. i do believe that we are dangerously close to really eroding one of our foundational principles. and that is the rule of law. we should not have governance by a chief executive by a telephone who doesn't seem to have a copy of the constitution. so i haven't read the opinion, but even in emergency situation, we have to be governed by the rule of law. one of the sources of our freedom and economic prosperity -- >> sounds like you would support hank greenberg. >> well as i understand the hearing and i'll say again, i haven't read the opinion, so as

i understand it there was no monetary gain to be had. no aig should have been allow to fail. i think giving creditors 100 cents on the dollar has helped make big banks bigger small banks fewer. and ultimately harming economic growth. what i'm saying is is that the federal government without having the rule of law should not be able to come in and essentially take over a firm. and so if that needs to be done we have toe follow the rule of law. we're losing the rule of law to the discretion of legislators. it's one of the reasons we're mired in 1.5% economic growth when we're capable of 3.5% maybe 4% economic growth. the rule of law must count for something in america. >> congressman, we want to thank you for joining us this morning. hank greenberg is appealing that decision. so there's still an opportunity for the taxpayers to pay him a little bit and debate over the rule of law to continue.

thanks so much. >> thank you. coming up today's top stories including an update on bird flu and why americans not related to the bird flu but many americans are having more babies at this point. stay with us.

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welcome back to "squawk box," everyone. in our headlines this morning, mortgage applications fell by 5.5% last week. that's according to the mortgage banks association. this is as the average 30 year-mortgage rate rose from 3.9% the week before. the bird flu outbreak in the midwest has resulted in get this cheaper chicken. the result is because restrictions by other countries on imports of u.s. poultry products. the usda says that has meant a greater supply of chicken in the united states. and there is still a market for greek debt. at a yield of 2.7%. when we return today, we have more to come. the best performing manager of the squawk platinum portfolio is selling netflix. that is his best performs stock to date. we'll tell you why he's selling and what he's buying instead. that's coming up next.

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the -- got a little bit of a -- it's a tall building we're in. >> we're on the bottom floor.

>> we're on the bottom floor. as you can tell. >> an elevator issue, apparently. >> somebody between floors 8 and 22. yep. so this gives us an opportunity to make some money. because we're going to go to -- now it stopped. you sure you want to do that? we're going to go to break anyway because we already counted our money. so we're going to break. we'll be back although the sound is already gone. so stay with us.

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the platinum portfolio that we run, the top manager is here with us. he's making a major move. kevin landis is the cio of first handicapal management. up nearly 33% year to date. he's now taking netflix out. it had been the best performing stock. talk about that first, kevin. nothing grows to the sky. how much money did you make on netflix? most of your gains in your platinum portfolio was netflix. >> i think that's right. >> how much has it put up? >> close to 100%. >> and you're replacing it with arista. okay. that sounds like arissa. sounds like the old mention. it's a competitor to cisco. >> right. >> what else makes it compelling for you? >> think of it this way. if netflix is a way of expressing your view that cable bundle is coming unravelled.

arista is part of the view that cisco can't get out of its own way. which happens to a lot of companies. >> i think there are other comments on that. he wasn't too enthralled with the latest guidance the company gave back in june. did you see him talk about? are you sticking with apple and since apple was added to the dow neither apple nor the dow has done anything. >> not much. the dow is a huge curse for tech companies. remember when microsoft and intel were added. >> app sl a curse for the dow and the dow is a curse for apple. so they're cursing each other. >> probably. >> right? >> yeah. >> so you're going to stick with -- you've got solar city you're sticking with.

making money on that now? >> yeah. there's a boom in california for this. california by itself is a pretty big market. but california mostly but there's a lot of other states where it's booming as well. >> is it down from -- i mean did you have it before oil collapsed? >> we had it before oil collapsed. we don't burn oil for electricity, so it doesn't directly affect it. psychologically. >> how about with apple, this is just what all great stocks do when they've gone up so much, they turn around and maybe move -- maybe some of the believers end up leaving. what do you think is happening? overhead resistance here. >> when you get a really big market cap, it's hard for growth investors. because i'm more of a growth at a reasonable price kind of guy. and i like it. it's cheap. >> cheap until it's not. >> who would you rather been than app snl. >> i don't know who the next

apple is. maybe apple is the next apple. >> we're looking for that. in the meantime apple is going all right. >> kevin landis thank you. what do you win if you win the platinum portfolio? >> i think i get to tell my mom. >> becky, do you know? >> we can make up a -- >> there's got to be a prize. >> yeah. i'm all in favor of that. i think there should be a contest among you folks to see how great of a prize you can give. whoever is winning mid-year. i don't want to tilt it too favorably. coming up we have target ceo brian cornell. he's going to join us. we'll talk about the health of the consumer and the deal to put cvs stores inside of target. this is not a common interview.

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volkswagen credit bonus on 2015 passat tdi clean diesel models. a bullseye of a deal. target looking to capitalize on the sale of its pharmacy service to cvs. we'll speak to ceo brian cornell about the deal and the state of the u.s. economy. wall street looking to build on yesterday's gains. investors are on fed watch today. your first look at yellen's message. the markets with bill george and former council of economic adviser chair glen hubbard. basking in the moment.

chicago blackhawks owner rocky wuertz on his club's stanley cup win and whether or not he considers this team is dynasty. >> he scores! >> the final hour of "squawk box" begins right now. ♪ welcome back to "squawk box," everyone. this is cnbc first in business worldwide. i'm becky quick along with joe kernen and andrew ross sorkin. in studio with us this morning sharing his thoughts on everything from the economy to company management bill george. harvard business school professor and cnbc contributor. >> nice to see you. >> we are less than 90 minutes from the opening bell on wall street. futures have been up throughout the morning. right now the dow futures still up by about 35 points. s&p futures up by 2.5. the nasdaq up by 4.5.

in europe we've seen red arrows. the biggest decline is the cac in france which is down by 1.25%. >> greece pulling off a successful debt auction despite its final problems. the company sold nearly $1.5 billion. paying an interest rate of 2.70%. also fitbit pricing ipo after the bell this afternoon. expecting $17 to $19 a share which would give it a $3.7 billion market cap. and two private equity giants this morning reportedly making a bid for ncr. blackstone and carlisle will make a joint bid for ncr in what could be worth more than $10 billion. shares of ncr jumping more than 10% on that report. >> so you -- gained six.

wasn't nearly as exciting at game seven. you thought it was game seven? you messed up somewhere? >> i admire lebron, what he did. you're right. it was the six game. i admire lebron going out without kevin. he's all alone, man. >> we've got to do this stocks to watch. fedex missing estimates by 2 cent. revenue also below forecast. and starbucks going to close 23 existing -- what was your? laboulange pastry shops. offerings in its stores. but says it's a separate l.a. operation is in its words a distraction. and earlier on "squawk" we spoke to ron baron about the state of the economy. he says investors need to calm down and yet carry on.

>> market 17 times normally ranges between 10 and 20. it's 17 times interest rates or as low as they've ever been and the economy is getting better. everyone worries about whether the market is expensive or cheap. but really the stock market the economy is doing fine. and the stock market is doing fine. >> long-term according to ron baron, everything is always cheap. which happens to be true. you can read more of his comments on squawk.cnbc.com. cvs is buying all of target's in-store clinics. in all target is going to hand off operations of nearly 1700 locations. those stores will be rebranded under the cvs pharmacy name. stores within a store. maybe we should explain that. joining us to talk about that and how it will work is brian cornell. he is the chairman and ceo of target. thank you very joining us today.

>> becky, good morning. and bill thank you for inviting me here today. >> good to see you, brian. >> good to see you. >> we have not gotten the chance to talk in the past. since you came into the company, though, you entered a company that was kind of in crisis and in turmoil. and you have taken some bold steps already. this deal with cvs is just the latest. getting out of the canadian expansion, that was huge. the street has looked at both of these ideas so far. has liked what he's season. looking at the stock, i think it's up about 39% since you came in. what do you think about where the store stands right now, what you need to do and how you're kind of looking at the overall theme for what your plans are while you're at target? >> well becky, i think we're still in the early stages of a transformation. we talked very much about our focus on understanding today's consumer. importantly what's important to the target guest. and we thought it was very important for us to focus on our u.s. operations really continue to build both our in-store and online capabilities.

you heard us talk about the focus on what we called signature category and really getting back to our core dna. our focus on style, those important apparel home and beauty categories. our focus on baby and kids. and more and more our commitment to wellness. and this great partnership we put together with cvs is really part of that focus on building our wellness offering. >> in terms of how you think things are going so far, how you think you're able to connect with consumers, how would you rate it at this point? because target was known for so long, i think it did stumble along the way. i say this as somebody who still shops at target online and on the website. where would you say you are right now? >> what we've seen over the last couple quarters is we're seeing traffic increase. they're voting with your feet and they're going to our website more frequently. ultimately we've got to continue to try to drive traffic and increase visit store site.

we've seen that over the last few quarters. we're pleased with our first quarter's performance. our comps were up 2.3%. we saw strong growth online. traffic was up. and importantly, though signature categories twice the rate of our overall comp. so i think we're headed in the right direction. we know we've got a lot more work to do. but i'm certainly pleased with the progress we've made. >> kwun of the areas you're focusing on is food. the grocery area in target is something i think that's been a bit of a challenge. is that a profitable area for you right now? >> it is. and we're still in the early stages of reinventing. we've stepped back we've done a lot of research. we understand what today's guests expect from us in the food category. and they certainly told us that we need to enhance our assortment. we need to bring more natural, organic, cleaner labels. in addition to the conventional items they buy each and every week. they've also told us we need to

enhance the in-store presentation. so we're in the early stages of reinventing our food business. we'll be testing carefully this year and looking to accelerate those changes in 2016. >> you've done a lot of the research yourself, right? just in terms of checking things out in the stores maybe not giving people a heads up you were going to be coming through talking to your own focus groups that you put together. >> well i try to get out into stores as often as possible. and balance the great research we do in house with listening to our team. and i learn a lot every time i go out from our store team leaders, our front line organization, and feedback from the guests. so it's one way for me to make sure each and every week i get out into stores i understand what's against us and i get a chance to listen to our team leaders talk about what they're hearing from the guests. i think it's an important combination. >> so brian, can we go back to the deal with cvs which one thing you really brought target is the commitment to focus. i remember you called me after

the canadian deal. clear commitment to focus on the u.s. and categories that matter. you designated those. now you've effectively partnered with cvs on the pharmacy side. but what's the impact going to be on health and beauty and how does this relate to what you've talked about as your wellness strategy? and does that somehow tie together the foo food strategy? how will you play this out for me as a guest? >> we're excited about our partnership with cvs. they're a leader in the pharmacy and health care space. they'll bring scale, expertise, deep experience. the benefits of their large networks is now going to be able to shop our stores and pick up precipitations inside of a target store. we think this is a winning formula for us and cvs. it builds upon our focus and makes sure we have great in front of the pharmacy. but we bring great assortment great presentation to our guests. and obviously we're going to

continue to manage and merchandise all those over the counter products as well as other wellness solutions. whether it's wearable technology, the fitness apparel that they wear each day, and some of the great food offerings we're going to bring that guest. we think it compliments our strategy, our focus on wellness. we now have an expert in that space and a long-term partner that i think is going to help us drive traffic and growth. >> you've got to bring in a lot of mini clinics. how's that going to work and what can i expect if i have kids to bring in or becky wants to bring in her kids? how's that going to play out? you're going to have all these stores that you have a pharmacy? or eventually or what's the plan? >> bill, we'll work with cvs. we're going to measure this carefully. we've got plans to continue to increase that. obviously larry and his team have talked about their clinic. we'll continue to work with them to make sure we're providing our guests the experience that they are looking for at target.

>> i just wonder what you heard from the shoppers that you've talked to directly. the people you've reached out to. what did they tell you that gave you some tips about where you thought you needed to make changes? >> becky, it was really helpful. i think the feedback that we've received over the last year and similar learning is just how important it is for us to be true to our brand promise. expect more pay less. i think we know over the last few years we may have lost some of that balance. we may have focused too much on the pay less side. so getting back to what makes target target what makes target target. that excitement we bring with newness b innovation great style. the excitement we were able to create just a few months ago with the lilly event in that collaboration where i really felt like we brought a black friday event into prilssapril and we excited our guests with great style, design. we're going to make sure we stay true to our dna. and that expect more pay less brand positioning has to guide everything we do.

>> we talked earlier this morning how millennials are shopping at walmart and love walmart. the only store they like better was target. do you think about millennial shoppers? is that part of where you're headed with this? or does that just sort of come with sticking to make sure you have fashionable things? >> becky we think about them every day. in fact, as we talk about today's target guest, we're focused on enthusiasts. it's the millennial family that loves to shop expects great value, is very visually connected. what we recognize more and more that includes hispanic families. so we think about them every day as we look to execute our strategy. >> brian i want to get your comment. there was a piece in "the washington post" that seconded the deal could ultimately mean higher prices for consumers, less competition in the market. what do you make of that? >> if we look at this deal, we think the combination of target and cvs and their scale allows

us to provide great value for the consumer and for our target guest. so i think as we go forward, we're going to provide great value. we're going to leverage the scale of the cvs system. their expertise, some of the experience they bring to the space. it's going to be important to the guest. and also their commitment to the pharmacy. we think this is going to bring even more value to the target guest. and to that cvs shopper. >> brian, how come you call them guests instead of shoppers? >> well it's how we think about the shopper we serve. they've had lots of choices, becky. and when they come in we want to make sure our team treats them like they're guests in our home. >> okay. so brian, a follow-up to andrew's question on the millennials. target's always been shy. walmart's been even more shy about getting into e the inner city. is this is a format you could see coming much more into the inner city where you can get the

real estate and have a much smaller store and provide that kind of convenience as people move back into the cities from the suburbs? how far can you go with this target express concept? can you envision having a thousand stores? >> well we're still in the very early stages. we had initial store here in minneapolis. we've had two open up in the bay area. one in san francisco. one near the campus at berkeley. but we're excited about the early response to the format. and we're really following the consumer. you just mentioned the fact that throughout the country, as i travel each week we see people moving back to urban centers. we need to be there to meet their needs. so we're very excited about the smaller format where we have a period level of products but we offer more assortment online. so the ability to order online pick up in those stores we think is critically important. and overall, bill i think that's one of the advantages we have as we go forward.

as we think about how we compete in a very challenging market we've got to leverage 1800 stores our ability to provide pickup experiences in the store your ability to click from the desk or kitchen. couple of hours later, pick up your order in store. then more and more we're using stores as distribution facilities. where we pack and work with u.p.s. or fedex to deliver the last mile. so we're following the consumer trends. and target express is just one way that we can get closer to today's consumer and meet the needs of our guests living in those urban centers. >> brian, thank you so much for joining us today. we really appreciate your time. >> thanks becky. appreciate the time. >> bill george our guest host will be with us for the rest of the hour. bill, you served on the target board 1993 to 2005. >> yeah. >> what do you think about where the company is now? it stumbled. it got away from the track. >> target even back in the glory

days was very shy about digital. you couldn't challenge them to get into digital. they held back from digital. they were slow in food. walmart was getting huge gains. so they're kind of johnny-come-lately in this. that's why this is important. is he really going to be able to bring those guests in three times a week for food. if you can get into the target express, it could be profitable. >> dotcom is a big issue. i've shopped online and in the stores. i've been frustrated with the online experience. >> amazon is one of their biggest competitors and they've been doing it for a long time. they're trying to figure it out. the billion dollars is a huge investment. same number that was thrown out at walmart. that's huge. you can see he's committed to doing it. that's why he's cutting back and actually the financial deal on pharmacy was very good. cvs has very good buying prices. >> what do you think of the target brand still today?

it had this sort of iconic -- there was something fashionable about target. >> so he stopped talking about the negatives. he got positives out there. and i think it brought the brand back faster than i thought he would. the enthusiasm is very high among the staff. and, you know he's got 400,000 people. it's not just the top team. >> great. >> bill's going to be sticking around. we'll continue that conversation in a minute. when we return we heard of big hack attacks on banks, retailers, movie studios. but now it's not even america's favorite past time that's safe. the latest on the cardinals hack k investigation next. then glenn hubbard is going to stop by with a look ahead at today's fed decision and conference. "squawk box" returns in a moment. it recognizes pedestrians and alerts you. warns you about incoming cross-traffic. cameras and radar

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welcome back, everyone. criminal allegations have shaken cardinal nation. the organization is being investigated now by the fbi and justice department for hacking into networks of the houston astros to steal private information. here is st. louis cardinals manager mike matheny yesterday.

>> we don't know more than anybody else. and just waiting to hear. we heard something from the front office something that's going to be addressed soon. and then we'll be up to speed. but right now we just go about our business realize it's something that's being dealt with. >> law enforcement officials say they believe the hacking could be revenge against astros general manager who left the cardinals back in 2011. this is kind of a money ball story. he was building up things about how they would recruit, had all kinds of statistics and then left and kind of rebuilt that system when he went to the astros. there's some question about whether maybe they were hacking in to try to figure out whether he'd taking proprietary information. >> houston's in the american league. i don't even -- this is -- i'm lost. anyway coming up after his big announcement, jeb bush hitting the late night tv trail. a slow jam of the news is next on the leading late night show starring jimmy fallon.

and later, what will janet yellen's message be about the interest rates? we'll talk to glenn hubbard. "squawk box" will be right back. ♪ building aircraft, the likes of which the world has never seen. this is what we do. ♪ that's the value of performance. northrop grumman.

yesterday in miami i formally announced my candidacy for president of the united states. i thought long and hard about this decision and after careful consideration, i determined that now was the right time to launch my campaign for the republican nomination. >> oh, yeah. the governor thought long and hard about joining the gop race. after months of being a total caucus tease. jeb finally made up his mind and quit beating around the bush. ♪ jeb really wants to get in the white house ♪ ♪ but not as bad as obama wants out ♪ >> addition 2016. jeb bush made his late night

debut slow jamming the news with jimmy fallon. more slow jams are just ahead. and then there was this. ♪ ♪ keep on rocking in the free world ♪ >> neil young is not too happy with donald trump using his song during his presidential campaign announcement yesterday. young issued a statement saying that the presidential hopeful was not authorized to use his song. young's a long-time supporter of bernie sanders and i love his music. love him. 30, 40 years. >> he's a bernie sanders man. >> did you see the recent article? either in your paper or "the wall street journal," but he is like -- >> he's rocking. >> not just a few screws.

the screws are gone. the bolts are gone. he's just -- you know maybe he's pickled his brain at this point. i don't know. he was canadian to start with. i love canada. when we come back we'll talk more about yellen's message to the markets that we're expecting later today. plus more from our guest host bill george. then is wild ride for the chicago blackhawks. we'll be talking to the owner about the club's success. right now, though as we head to a break, check out the equity futures.

welcome back to "squawk box." let's take a look at some stocks on the move this morning. fedex shares are under some pressure after the company fell 2 cents shy of estimates with quarterly profit of $2.66 per share. revenue also fell below estimates. they raised the age for board members to retire also. also botox plaker allergan is buying kythera bio pharmaceuticals. the deal worth $75 per share in stock or total of $2.1 billion. and china-based internet

services company qihoo has gotten a buyout offer from its executive. they are forms a special committee to consider that bid. united airlines is announcing it will end service at new york's jfk international airport in october. they failed to make a profit at jfk over the last several years. they offered few connections to other cities. united will add to its flights at its hub which is in newark. and delta air lines plans to acquire some of those united slots at jfk. they will take slots from delta at newark. it sounds like a trade in baseball or something. that deal is subject to regulatory approval. >> it's really just the ps service which is many of our viewers may know about. the only reel flights that united was flying out of jfk these days was to san francisco and los angeles. they were the premium service

only. they used to have sort of a true first class, a business class, and maybe economy plus. >> better home delta takes over those flights. because they do it better. they get you there early. you're on time. nice people. >> you're not a united man? >> i'm a delta man all the time. i don't have a choice. >> you can fight it out with walter isaacson who's on the board with united. >> not before that. anderson has transformed that place. >> believe me, i know. >> people are actually really nice. it was a big change. >> cincinnati hub, i followed it for years. and i remember all the crummy guys. they had the worst guy. you weren't a consultant ever were you? the worst guy was a consultant for mckenzie. >> yeah i remember. >> what was his name? >> i forgot. i wiped it out of my mind. but richard is it's amazing what he's done. >> he's like macgyver. work with me.

>> how they transformed the attitudes, that's what i like. >> i don't have a problem with united at this point. it was a tough continental in the united merger there were things that had to be accomplished. that's never easy. let's get back to what we've been talking about -- >> wasn't it mullen? yeah. >> we are counting down to central bank news. the fmoc's latest policy is due out followed by a conference with janet yellen. steve leisman is in washington for the big meeting. he joins us now with what to expect. good morning. >> becky, good morning. remember this was going to be the big meeting. back in the fall most of wall street believes the hawks, not the blackhawks the fed hawks would finally get on the board and the first rate hike would come in june. here we are hours from the policy statement and rate hike is coming. the oil danks, dollar strengthened, the first quarter

the economy contracted all to combine to liftoff. here's the only question that matters. are we back on track? gdp running at a 3% rate. wage growth increasing to 2.3% year over year. that's up .3%. and the unemployment rate remains unchanged. but that's at least partly because the labor force actually grew by the most in may since 2008. some on wall street they look to be getting antsy. fed survey showing a record 60% of respondents write in saying it's past time for the fed to hike. the economy is close to full employment and there are no signs that lower oil prices have produced broader deflation pressures. fed policy has overstayed its welcome at zero says john riding. leadership at the fed grappling

with other issues. rebounded strongly enough from the first quarter. it also has to factor in the consequences of a strong dollar if it raises rates amid continued european and japanese easing. it's looking for that confidence. inflation is moving back to 2%. all of which combined to provide the reasons why the fed will wait at least a little longer. a day may come when the fed has the courage to raise rates when it zeros interest rates. but it is not this day. joe? >> yeah. i don't know where they will be able to draw upon the courage to go up from 0% after nine years. i hope we have some stall worth people to make that decision that could have such wide ranging ramifications for the entire world to go to 25 basis points. courage. courage. you used to say that. mie idol dan rather used to say courage before he had that national guard break exclusive.

anyway. joining us now with more on what to expect from the fed meeting, glenn hubbard is currently the dean of columbia business school. courage? >> well i think it's time for the fed to -- >> i guess. >> -- be less accommodative. people inside the system know that. they unfortunately as a country and as a government we've asked too many of the fed. they're doing all of the work that the government should be doing. but it's time. >> you have to have courage to weather the backlash from the cainsians on steroids that write for the times that pretend we should never raise rates again. it's not based on the private sector. it's based on free money from the fed. >> what they're grappling with is the risks. if they normalize policy, there will be volatility on wall street. on the other hand they're encouraging risk taking right now by what they're doing nap is potentially dangerous for the economy. the fed's in a box.

>> there's a million, you know unintended consequences. not only moving people out the risk curve that shouldn't be and one of the reasons they can't go now, suddenly they're currency manipulators. they're afraid the dollar could get too strong so maybe there's some corporate profits that aren't as flush -- >> i don't think so. i think the dollar is already pricing the view that the fed is going to have to tighten. >> they should go today then? >> i don't think they will go today. i think they're balancing the risks differently than others might. but i do think they'll have to go this year. if you're looking at the underlying pressures on wages and price, they're going in the direction the fed said it was looking for. while gdp growth isn't great, it's clearly in recovery mode. it's really time. >> is asset inflation a faux argument? is there such a thing as a set inflation to be worried about? >> that's the flip side when people talk about risk taking. it is elevation of risk asset.

while the fed knows that is happening, they're not ignorant. it feels very good. on the other hand what we need to do is get the real economy growing again. we need better fiscal policy. we need things that encourage productivity. but monetary policy while it helped early on in the crisis is past its shelf date. >> are you a jeb guy now? >> i would talk to any candidate who wants to ask about -- i have. and i would be happy to talk to any candidate about economics. including mrs. clinton. >> did you talk to governor bush last week? >> i have. >> you made a deal between 3% and 2% growth. where do you see this trade debate playing out on that? do you see that as bringing -- seems like the people opposed to it think it's going to reduce jobs. the other side believes it's going to increase jobs. all the ceos i know want to go to asia. write the rules here. how do you see that playing out? >> it's a great question. the real question for the

country is we want to be on a path that grows at 2% or 3%-plus. and we can make that choice. trade is an important element. i do think there's a lot of politics right now around the trade debate and a lot of legitimate issues. there's no question that opening up other markets for american workers, american goods, american business is the right thing to do. i think this is one where the president is right and some of his detractors wrong. >> our markets are totally open. so we're really trying to write the rules, set the rules about ip and everything else with asia. my concern is the chinese are going to -- if we defeat this thing, the chinese will -- >> i think we already have stepped back in the sense we're not providing the international leadership in trade and finance we once did. >> glen there was a piece that ben white did a couple weeks ago that quoted you or referred to something you had said in terms of advice to jeb bush around

infrastructure spending. and the distinction you've made between the way you would approach infrastructure spending and the way the president has. and what a fine line that is. can you tell us about that line? >> well, i think the president considered infrastructure as part of stimulus. that was always a silly idea. bauss frankly infrastructure takes a long time to plan. what you wanted to do in '08 and '09 was radically shift expectations. you wanted to change the way business people think. you've got to tell them over the long-term demand is going to be higher. involves states local governments, the private sector. has nothing to do with stimulus. it's just better policy. >> we've had you on the dynamic duo with stern. right? where's he on trade? >> i don't know. you'd have to ask andy that. >> he's your friend. >> he probably has a slightly different view than i do. >> where does that come from? and how does it -- when you connect the dots and when you look at it if it's not just

intuitions, if it's something that's born out by evidence how do people on the other side come to that? >> the question we have to ask is what's the baseline? if we wall ourselves off from the world, we're still going to lose these jobs. right? we're not ever going to be able to push the tides back. the question is how do we help people change the jobs of tomorrow? not try to pretend -- >> how do you explain that to an elisabeth warren or someone on the progressive left? could you ever change their mind? >> i think you can, but you have to point to policies that would help people make transitions. unfortunately neither side is really good at that right now. >> all right. glenn hubbard, thank you. >> pleasure. when we come back the chicago blackhawks are stanley cup champs. it's the first time in 77 years that the hockey club has won the cup on home ice. that's got owner rocky wirtz feeling pretty good. we'll speak to him after the break when "squawk box" returns.

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♪ embarrassment of riches. but it was a sweet win if you're a blackhawks fan. for the first time in 77 years, the fans in chicago got to see it happen on their own ice. and that is winning the stanley

cup. blackhawks won their third in six years. that's what i mean. that's too much for any team. with a 2-0 victory in game six over the tampa bay lightning monday night. joining us now is rocky wirtz, president of the wirtz corporation, chairman of the chicago blackhawks. you've been -- you finally slept, rocky, or no? >> no. couple hours, but not too much. but i think it's getting a little better today. >> it was a great -- the whole year was good. maybe you have a feel for it. you came in after your dad ran the franchise for a long time. and you've had a lot of success in the last six years, obviously. three out of six. but hockey itself was almost written off. was it a lockout? or it was something -- remember with had betman on the show a couple of times. then nbc stepped up and i think -- i don't remember what

the network paid. i think it was like a dollar or something to broadcast nhl. now i found a lot of people talking about it and looking forward to watching every game of not just the finals of the playoff game. >> you know it's like a soap opera. you can't wait for the next episode. and once you get involved with the players and realize they're more than one dimensional, people are intrigued. and especially in chicago, people have -- we were irrelevant in '07 as far as a sport in my humble opinion. we were able to capture the minds of chicago sports fans. and been able to grow it since then. so it's been exciting. >> you -- i just wonder what you attribute the success to. looking at some of the history there, your dad's nickname was dollar bill. because he was frugal with the dollar. would you say you needed to spend money to make money and you've been a little bit more

generous in bidding for players in the draft and everything else? >> well it's not only spending money. it's developing organization and giving it the leadership and having a flat organization but making sure that everyone works together. so when you use the word team, you think of the players on the ice. but you have the front office and your finances. what i think it really comes down to is having everyone work together in one unified fashion, get really good people, and get out of the way and let them do their job. >> do you ever go into the wirtz realty office and look at what's happening with real estate in chicago? i mean it's a big company. i don't know if anyone knows that. $2 billion company or so. can you tell us how the real estate market is in chicago? >> well we have 2,000 apartments in chicago from evanston and the north shore down to lakeview in chicago. so yes, i get involved a little

bit. don runs that division for us. so he and i are certainly -- would do that on a rental basis. we're also looking at possibly building a blackhawk practice facility near the united center. >> and you would say that it's totally back to pre-recession levels now and headed higher? >> well i know our rents are very strong. and so for our rental markets, it's very good. so it's certainly getting better. you know chicago has had its ups and downs like other major cities. but i think it's certainly -- the mood is certainly on a much more positive basis. >> rocky, i know there was a bit of turmoil with the stanley cup. it wasn't actually there when the game ended the other night. did you realize that? kind of see what was happening behind the scenes? >> it's funny. i know when we were in boston in '03, the time i got down from the seats to the ice the cup was already on the ice. and it seemed like it was longer. we've had terrific rainstorms in

chicago. so what had happened is the cup was running late because it took them three hours to get from the hotel to the united center with streets being closed. so when they were presenting the -- you know the first trophy the cup wasn't even in the building yet. so it was kind of funny. i thought something was going on. i think eventually it was only four or five minutes late for television. but i think it was like a tv time-out, they were doing it on purpose. >> all right. rocky, do you think you would have beaten the rangers? >> i don't want to say anything. i think -- look. let's put it this way, we have a very good team and they all worked together and tampa bay had a terrific team. so i watched the rangers series very closely. quite frankly, i always love to see chicago and new york. >> i know. >> i thought we could have done it last year. but obviously l.a. had a good goal and we lost in seven games. so maybe next year. it would be a great series. >> kind of a jekyell and hyde in that last series with tampa bay.

they either score seven seven goals or no goals. and the games i got to see were the no goals because they were on the week ebds. anyway congratulations. three out of six. >> got to watch all the young players coming up. >> that's right. and why stop at three? why not have four? >> you weren't deflating the pucks or anything. >> the north star? >> they won't even talk to us. >> when we return we have jim cramer. we'll talk to him at the new york stock exchange and find out what traders are focussed on.

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stop taking cialis and get medical help right away. ask your doctor about cialis for daily use and a free 30-tablet trial. we spend a lot of time online around here. but with all this speed from xfinity, it's all good. hey, why don't we do some homework for a change?

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stocks. i think it's a terrific idea. corn elle is determined to make this america's retailer and i think he is just doing a terrific job. >> the stock has done tremendously under him already but you think there's still more room for growth? >> definitely. i think this company has been stuck back. he's doing well in apparel and baby. i think he's now going to do well in food. that's a difficult category. he's writing check to everybody who matters in terms of natural and organic. this guy is taking the business back. i think he's very competitive. >> what do you think act thebout the target express stores? they've never been comfortable getting into the inner city. is this a few phase of growth? >> i think it's good. i think when you go to the inner city targets like the one in

brooklyn it's shabby. but what i think target needs to do and what they're doing is get affiliated with colleges. you put a target express in the university of minnesota or berkeley or bucknell or virginia tech, you're going to have a tremendous leg up on everybody else. as soon as they graduate, they're going to go to target. as soon as they have a family they go to target. it's brilliant. it's cornell. he's right. up next another jeb slow jam with jimmy fallon. we'll be right back. you see it? that's a sensor. using ge software, the light can react to its environment- getting brighter only when it's needed. in a night it saves a little energy. but, in a year it saves a lot. and the other street? it's been burning energy all night. for frank. frank's a cat. now, two things that are exactly the same have never been more different. ge software.

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you were able to perform in florida but what's next for the worldwide jeb? >> i'm looking forward to hitting the campaign trail and discussing the issues that are important to all americans and having spirited debates with my fellow republicans about how to solve them. >> you don't want to mess with little jebby, because when it comes to debating he's a master. ♪ he's a master debater ♪ >> we now back with bill george

from harvard business school. he's a board member of goldman sachs and all sorts of other things. just real briefly on politics and the election in terms of the republican field, you have a view on how this is going to play out and how someone like a carly fiorina will play out? >> all these people don't have a chance. if jeb and hillary run it'll be a heck of a race. i think we need to have a sen tryst debate about something that makes sense and get to the debate. you have all these people pulling the party away. i hope the republicans need not to carve up jeb bush too much before he gets to the nomination. >> the president finally tries to do something for probusiness. >> he gets on the right side and then they undermine him. very upsetting to me. for once he's on the right side of an issue. somehow they have to find a way

through this. >> in the meantime i want to think you, our new cnbc contributor. >> these guys have to put the country before politics but that's impossible. >> make sure you join us tomorrow. "squawk on the street" is coming up next. ♪ >> congratulations to the golden state warriors on their first nba championship in 40 years. what a series. welcome to "squawk on the street" at the new york stock exchange. markets essentially on hold ahead of the fed's statement and press conference this afternoon. no real change in tone regarding the possibility of a greek