court, novak djokovic defeats roger federer. it's mon, september 14th, 2015. "squawk box" begins right now. live from new york where business never sleeps, this is "squawk box." ♪ ♪ good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernen and andrew ross sorkin. fire crews are struggling to contain an explosive wild fire that started saturday afternoon. it's now swelled to 50,000 acres. more than 10,000 people have been evacuated. at least 100 homes have been destroyed. one person has died. we'll have more on the story. now on the market news, check out the u.s. equity news. the fed will be making an

announcement come thursday, that's a two-day meeting, wednesday and thursday. you can see ahead of that the dow futures look like they're up ahead 36 points. s&p up by 4, nasdaq up by 15. we have a couple of big market stories we're watching this morning. disappointing economic data. fixed asset investment industrial producing falling short of estimates. retail sales did come in stronger than expected. shanghai composite closing down nearly 3%. volatile session shows that the index is dropping as much as 7% at one point. in other news out of china, government announcing that -- excuse me, government officials announcing that beijing will work to reform its own huge state owned enterprises and introduce mixed ownership. and in europe today interior ministers are meeting to talk about the migrant crisis and how countries can share new arrivals. germany temporarily introducing border controls saying the move

is urgently needed for reasons of security and to curb the large number of migrants. >> they stopped trains from austria moving into germany. couldn't help think we were right on that track only a couple months ago going from munich to salisbury and vienna. amazing. in corporate news today apple is currently selling out the new iphones, 6s. in china. ricoh suggests a man is stronger in china than other areas areas in the united states. it tracks the back order status of the models. it shows the wait time for the big screen iphone 6s plus is now running at three to four weeks. apple traditionally releases first weekend sales on the monday after a launch so we could hear something from the company later this morning. google hiring an auto industry veteran to run its

driverless car unit. don krafcik will take the job. he is aide t he's the president of automotive pricing true car. google says the man who's been the head of the self-driving car program since 2009 will continue overseeing the project as its technical lead. i want to skip the self-driving car. we were talking with our producer. go straight to the hovercrafts. you still have to sit there and, you know, sort of monitor things, right? >> yeah. i would think so. i read a study somewhere, the self-driving cars you're more likely to get sick in it. >> good for you. >> that's what got my radar screen. oh, yeah, that would be an issue. >> could there ever be a situation where it was more likely for you to get motion sick? >> yes.

>> when i'm driving i'm fine. when i'm not driving i have issues. that's the deal. if you're paying attention to the road something mentally clicks in. >> bmw, their ads on tv, what does that look like? when it's no longer showing somebody -- or even somebody this way when you're drivingm. t >> you'll see how relaxing it is. >> the thing that scarce me, oh, no, it's out of control. you're like this. moving. it's not happening. >> the stories scare you. >> you're hurdling towards a bridge abutment, nothing's working, you're hitting the brakes, that's not working. how, please, don't. i'm sorry, dave. >> you're going to have a hard time with it. they will be able to enforce speed limits. >> that there. >> who goes 55? people that will go 55 cause accidents. they do. >> you have read the article, i

know we have to move on, that the google cars all of the time there have been accidents it's because -- but because they follow the rules. >> because they actually stop at a stop sign. >> because they have a really hard time at four stops when every car is trying to edge out. >> right. >> somebody has to go first. >> you know the rules. >> yes, it's the person to your right. >> car on the right. >> i'm sure you don't know. clueless. >> there's a certain amount of -- >> but i get totally mad. >> come on. >> i'll act like i'm going to run into them and beep. >> you're kidding me? that astounds me. i could never imagine you doing that. >> people do that. they come up -- i'm there waiting. they'll do the pause stop and then start right away as if they're -- you know. >> no, no, no, no. >> nothing's worse than the left lane -- >> slow driver. >> yeah. yeah. no, i like the left lane.

i always drive in it. i go 50 and i'm -- >> what bothers me are the trucks that say no passing on the right. then stay in the right hand lanes. >> truckers are in general -- truckers are good. >> in general except for that. a lot of times they'll be in the middle lane and some say don't pass me on the right. get to right. >> you notice a truck that's a penske or a reider, some idiot that rented it. the pros know what they're doing. >> let's talk about barons. it says the shares of alibaba could lose another 50% of the value. another reason they cite, china's struggling economy a huge issue. they're citing increasing competition and the company's culture and governance. alibaba's stock is trading 25% chtd time from analysts. it says the number should be 15 times the multiple of ebay. now they're posting a letter to barron's editor. they say it contains factual

inaccuracies and the conclusions the reporter draws are misleading. >> a millennial is sitting right here, i don't remember which millennial, and i had a big argument. were you here? >> alibaba. >> you get 40% revenue. but they made like a penny and the valuation is like 800 gazillion dollars and -- >> but if you're going to buy growth. >> i've seen this movie before. >> huh? >> you've seen this movie before. >> i said, okay, i'm sorry. i know i'm not young and don't understand. >> the only question i have is whether you treat it like amazon or not. nobody's treating it like amazon. >> why, because it begins with an a? >> because they're very much in similar businesses. >> just trying to get market share. >> for some reason we've given

jeff bezos a pass on earnings. >> they have the same ability to deliver retail goods to consumers. >> they're closer to ebay. >> that's what i mean. >> they have better earnings. they're growing much faster. >> a lot of it is b2b. business to business. components, things like that with alibaba, no? >> that's another piece. >> not nearly as retail as -- >> it's a faster growing of ebay. >> then they don't use u.s. accounting. all the numbers are -- >> that's very true. >> it's not state run. like you saw all the news on i don't know what they're going to do with the state owned. >> they could appear. >> you're taking their word for a lot of stuff. >> i thought there were higher requirements if you were listed here versus being listed in shanghai. >> i wouldn't -- there are but you have to believe that somehow the listing officials understand

the numbers. >> they don't have the same accounts? >> technically they do but, you know, anderson -- i'm not saying err they're there. >> i think we better move on. facebook is working on a new app to support 360 views. it will allow people to change viewing perspectives by tilting their devices. you remember how facebook bought okay cue luce for $2 billion last year. this is something that could play off of that. >> where are we on this whole, you know what i'm talking about, this whole virtual reality, you know what i mean? >> that part of the virtual reality? >> yeah. you know. >> very unfamiliar. >> okay. >> i know what you're -- where you're going. >> it didn't take you long to figure it out. >> that's not happening yet. >> the technology is not moving forward quickly because of its adoption. >> i am not aware of that.

it will eventually. >> i'll do a little work to find out. in the meantime, let's tell you about deal news. shire considering options for baxalta. shire is weighing putting cash into shareholders hands sooner. shire has an unsolicited stock holding last month at $36 billion based on shire's stock price at the time. the lack of cash was to maintain the tax status. shire promised a share buy back program after the close of that deal. also solera holdings going higher. they were bought for $3.7 billion. that's a 13% premium to friday's closing price. let us check on the markets this morning.

we had a huge horrific selloff in china but we're okay. so far off 55 points or so on the session. that has to do with europe taking it in stride with what we saw even further east. the dow jones up 54. the s&p up 56 and a half. europe is mixed. italy and greece trading earlier. look at the asian markets. there's shanghai which is down 3%. it was i think worse. i think it pared its losses going into the close which indicates there may have been government support. we can't check on a daily basis. it was worse than that earlier. going to be talking to a couple of oil guys today. we decided oil was something we wanted to look at especially with the fed meeting this week. 44.66 now on wti. let's look at the ten year. did you guys read the journal

piece? talking about how many different countries have failed? >> tried to raise rates. >> it was the eurozone, sweden. >> it was ugly. >> india. >> stanley fisher -- >> and israel. >> israel did it. >> he left and within a couple of months it was back down. all the way down ten basis points who we had on and who defended his moves. talking about it there. there's the euro at 113. quoting draghi. all right. we have been waiting for the fed's big september meeting on interest rates. we've been talking about it a lot. during our squawk 20th anniversary kickoff last week

two of the biggest hedge fund titans had differing views. here's what david tepper and bill ackman had to say. >> i'm not as bullish as i could. i have problems with earnings growth, i have problems with multiples. i have all kinds of problems. i can't call myself a bull. >> i'm a little more bullish than mr. tepper. i think the stock market on next year estimates is something less than 15 times earnings. so which one is right? joining us to weigh in is jason trenner. he is with strategis partners and phil orlando. welcome. whose side would you take on this? more bullish, more bearish? >> i like ackman. the way we're looking at market is we've rolled forward to next year's earnings. that puts us at 14 times earnings. given 1.2% inflation and 2.2% treasury yield, that's cheap. >> you made the point earlier,

phil, what we're seeing is a correction. we've seen a correction since then. >> right. >> is the market stajding still? company's profits kind of pick up. you're not worried about the profits being picked up? >> no, i'm not. i think it was exacerbated by the china concerns. that's why we had the 11 or 12% correction but i think much like 2013, we've seen the taper tantrum then. now we're already pricing in the fed beginning to normalize policy. once we actually rip the band aid off we're going to be in okay shape. >> jason, how about you? this is a bs answer, i'd say they could be right. >> you've been on before. >> yes. no, listen, i think if you've had a longer term time horizon i'm much more in line with mr. ackman. i think if it's a shorter term, until the fed is out of the way, until you get some idea whether china is going through a hard

landing -- >> what's a short term and what's a long term? >> short term is over the next two or three months. wouldn't surprise me. last time i was on we talked about the chance that you could reach the prior low but i will say this. the moment the fed tightens i believe a low will be put in within 48 hours. i would be an aggressive buyer of the market. >> because you think there's going to be a massive devaluation -- a massive correction? >> i don't think there would be. i think that it's out of the way. i think that uncertainty is out of the way. i think it would be accompanied by such dovish language on the part of the fed that you would realize that janet yellen is not going to derail the recovery and, again -- >> by the way, just to be clear, we're taking sound bites and we're chopping it up. tepper did say if the market sold off he would be a buyer. he's more in cash now than he had been before. if things sold off he would be a

buyer. >> listen, the difference perhaps between the other times when the central banks had to tighten and ease, auto sales in august were 18 million units. u.s. economy, if it can't withstand a 25 basis point increase in interest rates we have other problems and we should look at ore policies, fiscal regulatory trade. >> sorkin, did you do any kind of homework this weekend? >> what kind of homework? >> "new york times," sunday, business section, the thing -- not the gretchen morganson piece. >> i did read dsh. >> did you know that stock option compensation for ceos is what causes product recalls. definitely connected the dots. no. this is exactly what's going to be involved with the fed in terms of paying banks to hold reserves so they don't make loans and you drain some out of the system.

it's very expensive and we've never done it before. >> spending more money. >> not just raising rates 1/4 points but all the unwinding. it's unchartered territory how it actually works but it's going to be expensive. the treasury is used to the fed shipping half a trillion dollars. they're not going to get anything. it's going to cost money to keep people from -- it was a hard article to read. did you read the whole thing? >> i did. >> did you? >> i read it. i was finally saying, what am i doing to get through this. >> there's the other debate that dividends, do you know about this, the banks have to buy certain bonds that get dividends. separate article that came out this morning. there's a lot of things that are going to go away. >> other than going up a quarter point. >> around the world the reserves, did you read some of this? one brick is what they used to hold. it's a five story building of reserves now.

excess reserves that the banks don't need to have right now. >> the fed has always wanted to pay interest on excess reserves. the reason it was put in place is it was thought too expensive before they quinn it tupled thee of the balance sheet. >> jason, you also said that you think the market will rebound and bounce off the lows 48 hours after the fed moves. i was trying to figure out no matter what the fed does this week, it's a disappointment to wall street. if they raise rates, they'll be half the market that's disappointed. if they don't raise rates it will be half a market that's disappointed. what do they know that we don't? >> that's the risk. the raise in interest rates typically has a knee jerk reaction down. those investors will be disappointed. if the fed doesn't, the thought process is, well, what do they know that we don't know in terms of economic growth or earnings

growth. >> if you don't move now, when are you possibly going to move? >> exactly. in terms of what we refer to as the apology tour. over the last 60 years or so a normal fed fund raise is 5% rate. we're talking about getting to 1% next year and yellen stopping at that point. that 1% given the complexity and size of the u.s. economy is not going to derail economic growth, corporate earnings and share markets. the market has to get over with 1/4 points here. >> what do you think happens this week? how does the market react? >> i agree. i think we're looking at a retest on the lows. somewhere in that 18.20 to 18.70 neighborhood. then we're going higher. i would love to see the market rip as we get into the back end of this year and next year. we get this behind us and we start to focus on resumption of

economic growth, resumption of earnings growth. >> bill, jason, thank you guys both for coming in. >> thank you. did you read the botswana article? >> what? >> botswana. >> i don't think i did. >> no trophy hunting anymore. >> right. >> so no one's making any money or what used to be very lucrative for a lot of people and the lion population has grown so much now that people are scared. all the goats. anything on the periphery of the villages getting eaten. the crops, so many elephants getting run over by the elephants. it was in "the new york times." i was proud. >> well-read gentleman. >> got to look through it. i know you're going to buy it but sort of -- >> i'm a -- >> he doesn't have to buy it? >> no, he doesn't have to buy it. >> you know what they say -- >> do you not get it free. >> you can wire it or read it. >> i am a subscriber. do you have to pay for it or do you get it free for working

here? >> i have free electronic, 50% off. i don't know what the deal is. something lying that. squawk gets political. new poll numbers coming in from the battleground states of iowa and new hampshire. plus a donald trump/jimmy fallon exchange going viral. first, as we head to break, here's a look back on this day in history.

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helping to bridge the digital divide. it's huge, huge, huge, huge, huge. >> that helps. that was donald trump obviously joining jimmie fallon on the "tonight show" on friday. i love that squint, and it is a good squint. jimmy had that down, too. the huge, the way he drags that out as well. that was pretty good. always helps to be

self-deprecating, john harwood joins us this morning as we get ready for this week's big gop debate. that works a lot, doesn't it? especially for someone that, you know, they have criticized as having a big ego. that's what critics say. it always helps to make fun of yourself. >> i think it's going to be huge this week. >> huge. >> the cnn debate on wednesday. it's really a moment where i think we're going to get a faster pace from these candidates. i sat down yesterday in manchester, new hampshire, with carly fiorina who's made the big stage. we're going to have a speaking interview that rolls out wednesday morning. she is ready to go at donald trump and i think the other candidates are as well. this is the time to engage. there's a significant difference between august and september in the mind set of campaigns. i think you'll see that. >> if it appears that everybody is ganging up on donald trump, what does that do to his

numbers? >> everything we've predicted about his numbers has been wrong so far. i'm going to hesitate to make a prediction. the post abc poll that is out today donald trump has 33% nationally. think about this. 33% for trump. 20% for ben carson. that's more than half the republican field landing on those two guys. tells you something about how people in the republican party are feeling about politicians who are in office already. big challenge for marco rubio, jeb bush, scott walker, chris christie, others to try to step up and make the case for why they deserve to be in the finals. >> john, squik ll ll lly -- qui the other side. bernie sanders up and i don't know whether the primary matters. the server deal, the mickey mouse firm that did the server. they said as far as they know, nothing was wiped with a cloth

or otherwise. i can't figure out whether that's good or bad. i thought that was good for hillary clinton because it means there was no -- nothing diabolical happening or is it bad because it means all those e-mails are retrievable at this point and we're going to see what's in there? >> well, i guess that judgment turns on whether you think there's anything super secret and spooky in those e-mails. i tend to doubt that. you know, she turned over work-related e-mails. she made a judgment about that. she deleted the personal ones. was her judgment any different than those of any other public officials who does personal e-mail on a different -- treats it differently than official? to me the relevant questions go that the investigation is ongoing, we'll determine, a, was

the server that she maintained more vulnerable than the nonclassified state server which would have been the alternative if she did as people would urge to do and use the state e-mail. secondly, if it was more vulnerable, was it, in fact, hacked. >> yeah. >> the third is we're giving a lot of attention to information that's classified either formally or later or something that the information was classified by intelligence agencies. a lot of that is endemic to the culture of state departments. the question i think the fbi will look at is was the clinton state department more lax in dealing with information than other state departments? the answer is not necessarily obvious because the issue of spillage of classified information getting into nonclassified system is one that

exists all the time and -- but they monitor. so i'm eager to see what that review shows. a lot of interest. >> john, i have a separate one. want to go back to the donald for a moment. this is on business and ceos. over the weekend he was on face the nation. he called for pay for ceos disgraceful. the ceo of macy's, they had a relationship or macy's had a relationship with donald trump with the ties and everything that ended. does that work for donald trump? i mean, here's a guy who is a business executive who likes to argue all the time that he's worth $10 billion, has been paid well, is a wonderful negotiator yet then he is denigrating the pay of his ceos and many of his friends. >> i think it's an interesting tactic, donald trump. he is -- he's been trying to tap into a lite bit the sense of

ordinary americans, that tles a something askew in our system with people at the top making too much. he's going after the hedge fund people, saying they're paper pushers who don't pay their taxes. the ceo thing is interesting. i'm imagining that he makes a distinction between entrepreneurs like himself and people who are running companies who he would liken to bureaucrats. i think that dynamic is going to be the undertone of carly fiorina and donald trump on the stage. she was a ceo of a public company. he a real estate entrepreneur who is very flamboyant. i think there's going to be a lot of sparks in that dialogue. >> he said he wouldn't try to do anything about it, it's up to boards. boards are too many times in the pocket of the ceo. i don't know whether that's true. that was pure -- you know why i picked terry on that one. that had totally to do with the

macy's. >> because they canned him. >> exactly. but the donald -- >> everything's personal with donald trump. >> he'll take it. >> knows who attack him, he says, be warned. "the wall street journal" today, if you attack him, you will fall. he's been saying that for a while. >> that's good. well, i -- >> be warned. >> i guess we should be trembling in advance of our debate in boulder on october 28th. maybe the question rubs him the wrong way. >> politico has written eight pieces on scott walker and his demise. have you noticed that? i got it on twitter. it's been like, do you understand na? is it an anti-union, pro-union thing? i think politico should just merge with "huffington post" and get it over with. that's where they are, admit it. >> i'm in sympathy with your sentiment, joe. i think people are eager in --

there's so much political press out there. everybody's trying to come up with a sharp, fresh angle. before -- while the campaign's going on, somebody's struggling, they want to write the obituary before the guy's dead. >> scott walker. >> twitter makes it worse. >> that's right. >> scott walker is going through a difficult period. >> everything unfortunate has never been thought of before. >> you know what they say. >> our new news story is only reporting. >> got to being. sorry. see ya. thanks. when we come back this morning, stephen colbert turns to siri for some advice. we'll tell you his question and answer from his siri watch after this.

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♪ ♪ gratuitous commendation. just talking about it. >> yeah, we were. >> coincidentally. >> i went up there and got, you know, i got so much mail there that we don't -- >> i proved that i looked at you fondly. >> you know how many shots they took. we got a fine one. yeah, it is cool. it's big. and then coming back, we drove in to see it, we were coming back -- >> you don't drive through that way. >> i saw it this morning. >> just barely, people are so --

i just barely slowed down in the right lane when we were going back out and i looked behind me and i see this mini van. it's like -- almost ran -- i said, you know what, we're not going to get a great picture. >> you can drive up top. >> you can't up there. >> riddle me this, batman. >> yeah. >> you're in the -- you're in a plane. you're in the bathroom on a plane. food comes. do you eat the food off of the toilet seat or off the tray table? >> why would you be -- >> what's the segue? >> do you eat off the tray table -- >> no, i don't eat off -- >> off the toilet seat. >> bacteria. >> tray table and a new study has eight times the bacteria. -- >> you know, i would -- >> -- toilet seat. >> how can that be. >> it's in "the post." >> they wash the bathrooms. they never wash the tray tables.

>> if you were the first person to be -- >> to be on a plane. >> to eat off the toilet seat, yes. but after the first person's already been in there -- >> you guys are both -- >> no. what i will say. you know what a germophobe i am. >> that's why i did the story. >> i was so freaked about everything. i brought purell in for everything, including the tray tables. i've gotten over it. >> do you know what is worse than the tray table? >> floor? >> drinking fountain. >> oh, yuck. >> why? >> all in the new york post. >> these are just things that never get cleaned. >> you know what's worst? never put anything in the pocket. >> they stuff nasty -- >> you put kleenex down there. >> you put tissue down there? >> not -- not -- not used ones but -- >> some people. >> i take them out of the bag, the peanut m and ms, that's

where i save them. >> all right. i am doing another one that crepes me out. >> gummy bears. >> if you didn't have enough reasons to not go to a movie theater these days, much more comfortable to see things, eat with your whole family there. turns out there is a time square huge movie theater that apparently has bed bugs which i didn't even know you could get at a movie theater. bed bugs. there have been five people who come through who have reports. amc is closing down a section of it to get rid of it. i didn't know it was possible. here's pictures. the woman posting the bites on her arm. >> are the time square movie theaters that giuliani and bloomberg closed down. are they back now that dide blao has done a great job of cleaning up the city. >> if you don't have a full -- >> i no longer frequent them. >> i'm unfamiliar. i'm unfamiliar.

>> that's not soda. >> that is soda. >> no, that's not. >> it is. >> it might be but it's mixed -- >> even though amc has this problem. they have the best movie theater, they have flatbed seats. one quick story because we have to go. mr. cook, tim cook, ceo of apple. get your siri out, stephen colbert says get your siri out because he will be on col birth. >> a tweet. there you have it. >> siri, put apple ceo tim cook on my calendar. does he not have access to the ratings of business news organizations? is he colanic. >> calanic. >> whatever. >> what else? >> then he had elon musk. >> now he's got stanley fisher and jim bullard next week in a

knock down dragout comedy routine and then -- >> wait. >> then the cfo of wells fargo is going to be joining him. >> all guests we love having on our air. >> we love them because we're business. you know, i guess its he's so cerebral. >> he's a really smart dude. >> he likes what we like. >> he better make this interesting. >> see about that. coming up when we return, oil prices down a bit this morning, but this week's fed meeting could be a big game changer. we have that story when "squawk box" returns after this. and why stop what you're doing to find a bathroom? cialis for daily use, is the only daily tablet approved to treat erectile dysfunction so you can be ready anytime the moment is right. plus cialis treats the frustrating urinary symptoms of bph, like needing to go frequently, day or night. tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain,

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you are on again today. >> again and again. >> let's bring in john kelnof at again capital and cnbc contributor. once we sign you up, you're ours. >> once you're on "squawk box" -- >> he predicted crude falling in the $20 range. goldman sachs now, i think that's what killed us. they said it could drop to the same level as well. briefly had a nice snap back eye. i don't know what that indicates. it gained 25%. >> yeah, it was wild. >> why? >> it's the volatility you're seeing around all the markets. >> it was like, uh-oh, we were wrong about how much is in storage here, we're wrong about how much we're producing. the slightest thing can go up 25% or down 25. >> you know how in commodities,

the herd gets to one side or the other. >> yeah. >> the oil market got heavily short. when the data point came out of the weekly government report about the u.s. production coming down, yeah, people panicked and bought it up in a big way. temporarily. >> chances are slim we get into the 20s, aren't they? >> i would put it 40%. >> no kidding. really that high? >> yeah. yeah. what would happen to economies of oil, you know, economies that depend solely on oil for income? i can't imagine the social ramifications of that. we could have a war. >> well, yeah, potentially. there's a lot going on in the world on that front. there are countries that are better protected for this. brazil, for example, disaster. venezuela, even iran. saudis -- >> they take care of their people with oil revenue. >> yes. the saudis have socked a lot away. i think there's still a lot of

runway for them to hold on and grind through this. what you're seeing, the damage that was being brought not socially but in the u.s. oil companies, there's a good story in the wall street journal about the big right downs that are still to come on that front. so they're getting wrung out. that was part of some stabilization last week, joe, that the u.s. production is coming down faster than even i thought. it's down to about 9.1 billion barrels a day. we've cut about 400,000 barrels a day now already. >> yeah. >> so it's that $20, that's why i put it at 40%. i was more confident be about it last time than when i was on with you guys. i think this is starting to correct. >> deflation can be insidious in japan, whatever you want to call it when it takes hold. this is not great for, you know, if you're looking for at least, you know, some nascent inflation for the world. this is a serious problem. but when does the positive

aspect actually filter through the global economy? this is like a tax cut for the plan. a 50% expense cut for what we spend to run things. when -- doesn't that ever translate into a markup in global? >> it does soon. specifically when you think of japan, china. >> plastic. >> our own petrochemical sector is booming. that's a great job creator with great paying jobs. consumer goods should be bought up. i think it's going to be great. you see back to school, big halloween, big holidays. i saw $1.83 a gallon on route 17. you can fill your jeep up for 25 bucks now. >> would the world be -- we'd be kicking ass if we had $500 a barrel oil. then we, whoa, we're all growing at 8% now. >> you've seen the deleterious effects of that. >> but the opposite should be positive at some point. >> i think it's working its way

through. what's happened over the past several years is that the one booming area in a bad economy was the commodities sector as it got built out to supply china in what was thought of insatiable demand. the relief to the manufacturing and consumer in the end has to far outweigh the damage that the commodity sector is now bringing to the data point. >> do you think it's masking things? would the consumer be in much worse shape if we didn't have it? >> absolutely. i definitely think that. everything from, you know, vacations and consumer spending. >> if the fed raises rates and oil prices pick up? >> what's that? >> what if the fed races rates and oil prices pick up? >> it will be a double khameneiy. the other thing we're watching is the whole trouble in the middle east. russian military presence being built up in syria. you know, sort of a -- i don't

know exactly how to calculate that in yet, but it's a worry that we could have a theater of war there again and that would send prices shooting up. you know, it's a very delicate balance. >> all right. john. when we come back this morning, auto sales finally could a labor strike threaten detroit's come back. uaw's latest move when "squawk box" returns. no one way of driving on each and every road. but there is one car that can conquer them all. the mercedes-benz c-class. five driving modes let you customize the steering, shift points, and suspension to fit the mood you're in... ...and the road you're on. the 2016 c-class. see your authorized dealer for exceptional offers through mercedes-benz financial services. it's more than a nit's reliable uptime. and multi-layered security. it's how you stay connected to each other and to your customers. with centurylink you get advanced technology solutions,

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. welcome back to "squawk box". uaw is gearing up for a walk off as the union's contract gets set to expire after today. the target of those walkoffs could be a surprise. phil lebeau has morn that story. >> reporter: good morning. fiat chrysler was picked yesterday by uaw as the lead or target company in contract negotiations. doesn't mean there will definitely be a contract with fiat chrysler before gm and ford. the current contract expires at 11:59 this evening. however let's keep in mind that the contract can be extended day-by-day so it's likely we'll not see people walking out and going on strike tomorrow. it's possible. but unlikely at this point. when you look at the uaw what they are looking for in this current contract two things stand out. first of all as they began formal contract negotiations and there was the hand shake between the head of the uaw and ceos of the big three, this head of the uaw made it clear they are

looking for an increase in their hourly wages. for many of the uaw members they have not had raises in seven years. the other issue, two tier workers, remember as part of the bail out that was introduced back in 2009, the uaw agreed to allow the big three to hire a certain percentage of workers coming in at a lower tier, basically $15 to $18 depending on the job versus $28 hour. that's been helpful for chrysler, 45% of its workforce now lower tier workers, there you see the percentage of ford and gm at 20% according to the center for automotive research. for fiat chrysler two things are front and center. obviously the uaw wants higher wages, some type of a pay increase and they also want to see either elimination of lower tier workers or certainly a much lower rate in terms of how many of those workers are being hired at fiat chrysler. the contract expires at midnight

tonight but doesn't mean we'll see a strike or walk out tomorrow at any of the plants that are run by the big three. guys, back to you. >> when is the last time we had a walk out where people left the factory floor in the middle of the day? >> reporter: i think it was 2007, 2006. contract right before the bailout. it was almost a symbolic strike. it was just outside of detroit. i think it was the gm plant. it's been a long time since we've seen sort of that vitriolic we're going on a strike and inflict pain on a particular automaker. >> phil any idea how many bacterial colony forming units per square inch on an airplane tray table? 2155. >> reporter: you learn something every day. >> versus bathrooms 70.

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the countdown to this week's fed decision is on. we'll breakdown the odds of a rate hike and tell you which stocks are most vulnerable if interest rates do indeed go up. >> government shutdown is looming. congress has less than three weeks to pass a spending bill. pat toomey will tell us if a compromise is possible. >> apple ceo tim cook planning a victory lap on colbert this week. details straight ahead as the second hour of "squawk box" starts now. ♪

live from the beating heart of business, new york city, this is "squawk box". welcome back to "squawk box" here on cnbc first in business worldwide, i'm joe kernen along with becky quick and andrew ross sorkin. we have started the countdown with the fed's interest rate decision and it's on. that announcement coming on thursday. u.s. equity futures at this hour are indicated up about 50 points or so on the dow, up six on the s&p. nasdaq indicated up almost 20. overseas in europe there was some green but nothing that great. a third of a point really in germany, france and ftse. italy and greece are down. and in asia, we are seeing not great results, hang seng it's okay. japan was down almost 2%. shanghai almost 3%. shaking that off and headed higher.

>> let's tell you what else is going on. in europe interior ministers are meeting to talk about the migrant crisis and how countries can share new arrivals. in germany they are temporarily introducing border control saying the move is your gently needed for reasons of security teen curb the number of migrants. germany's vice chancellor says the country can expect 1 million migrants this year. in the u.s. swiftly spreading wildfires are now destroying hundreds of homes in northern california over the weekend. the houses of residents fled middletown, california. officials are calling it the valley fire. now the most destructive of dozens of fire that ravaged the western u.s. this summer. >> gas prices have plummeted, dropping 20 cents per gallon. average price of gas is $2.44 per gallon. crude oil prices increased slightly but refiners and retailers cut gasoline prices to compete with volume sales.

summer grade fuel will end across much of the country so production will be cheaper for most refineries. >> in corporate news apple is selling out its new iphone 6 s in china. early data suggests demand is stronger in china than most regions of the world including the united states. based on information from an iphone inventory blog that tracks the back order status. it shows the wait times for 6s and china is running three to four weeks. apple traditionally releases first weekend sales on monday after the first weekend of a launch. if we don't hear from them today apple's ceo tim cook will be on the late show with steven colbert. we're watching shares of alibaba. the stock could lose another 5% of its value. china's struggling economy, increasing competition in e commerce and more scrutiny of the company's culture and governance. it's trading at 25 times it's

earning estimates and argues the number should be closer to 15 times. that would be the multiple of e-bay. now alibaba is fighting back and posting a letter complaining about that story. alibaba spokesman said the article contains factual inaccuracies and says conclusions the reporter draws is misleading. it is crunch time for the fed. we'll be getting the latest interest rate decision later this week. don chu joins us now. >> reporter: always going be the ones that pay bigger dividends than bonds over certain periods of time. if you talk about this idea that utilities, the s&p utilities index down 12% so far on a year-to-date basis as these interest rate concerns start to fester among traders and investors, as interest rates go up or threat of interest rates going up comes to the marketplace, the relative

attractiveness for the dividend yields for telecom stocks, utility stocks they lag a bit. utilities very much a to dulles. take a look at other reasons why we're watching this. leading this year's decline so far, pg and e, southern company, nrg, down with some of their value. so far on a year-to-date basis to give you and idea how bad it is, close to 30 stocks in the overall s&p utility index. only two are positive on a year-to-date positive and that's agl resources and tico energy. they are m and a targets. interest rate story is playing very well out right now in utility stocks certainly ones to watch given the fact that the fed could move later on this week. back to you. >> you hear? holy cow. i heard it here. it's weird. i'm hearing him in both ears.

dom, come on over. but let's bring in another voice into the discussion. tom lee fund strike global adviser founder and head of research is here. if they go, do you think theology go? >> i think it's still something people don't know. i would be surprised if it happened this week. >> is it possible there's some type of immediate dislocation, scary y2k blow up scenario? is that possible? >> i mean clearly that's what people are worried about. i mean you've seen turbulence at times when the fed makes its first move. if this is the '50s, low inflation, low growth environment it would be seen as a reflation signal and back then it was a bullish outcome for stocks. >> you saw that around the world rate hikes when they are

done too soon they reverse with egg on face like six months later because the economy doesn't cooperate. will that happen here? >> that would be the worst thing to see almost a decade of no rate hikes. you get one. >> because we're stuck here. trying to get out and we can't. >> i think investors especially between now and year end want stability. if the fund does put things on hold they prefer to say, hear the fed say we won't have the door open until next year. >> joe, it's interesting because we talk about all these ideas they could affect the economy overall. when you talk about some of the moves happening in the markets here in the united states, and you start to telegraph certain things. there's still a number of strategists out there think you got cyclicals like industries, financials that are poised to do relatively better than the other ones out there. is there still a case to be made that those particular stocks can still out perform?

we had a huge bull run. we had a market triple since the loss. isn't about time we slowed down a bit just to say maybe for a few months reconsolidate and everything else in the marketplace. i don't know if that's the time now. >> i think in the last month a lot of people who were bullish and buy the dips have now gone into this indecision camp, right. for the reasons you describe which is let's see how this thing gets resolved. i think there's bullish things developing, though, for instance i think dollar strength which was hurting the industrials and tech is not a head wind early next year it becomes a tail wind. oil is now at this sort of pivot point where if prices stabilize here or start to rise that's actually a bullish development. both from an energy perspective and it's already a level that's helping consumers. and i think sentiment which

hasn't mattered in the last month is so bad that i think we're better positioned for good news than bad. >> he's been good, andrew, with just overall market calls. >> right. >> i'm willing to give you a special dispensation to ask him the question, to ask him -- >> the apple question? >> no. >> the bottom question? >> yes. >> bottom in. if not, when? >> i will say some things are telling us -- some things that you look for to say bottom is in are usually small caps, outperforming. almost always turn up one day to two weeks before the actual bottoms in. >> is that happening? >> small caps bottomed versus the s&p on the 24th of august. >> you hear that? see you might get an answer. >> what about schiller? i'm saying -- >> have you heard someone say --

>> did anyone see the schiller numbers. >> did you hear people are getting negative. that means the stock market goes down. when negative sentiment rises it's bottom. usually that's the case. >> he's an academic. >> okay. >> exactly. i rest my case. >> i would just say that there's a ton of stuff. you talk about these confidence indices and everything else. they are tangible numbers that will come out in a few weeks. earning season kick off again. we always have this kind of catalyst. i would just say the one concern that a lot of traders are having right now earnings have been growing but been slowing down. so the change, rate of change of that particular move is starting to get to a point where we may have, maybe, low expectations but still flat to no earnings growth to maybe negative, right? that's is going to be the big concern. >> i think it's correct to say

earnings from energy -- >> a drag. >> they have been a drag. the drag is shrinking. earnings because of the dollar, dollar was so strong it really hit industrials and tech. that's going to become a tail wind. i think you have two groups that you might see better comps coming out in the next couple of quarters. you have to remember even if earnings generated from china is plateauing or flattening, really, earnings related to u.s. investment spending are just beginning to accelerate. housing data has been good. look at the builder. i don't think that you would necessarily have to say earnings will keep slowing to zero. i think there's undercurrents that could cause earnings to reaccelerate. >> if you're not 75 or 80, do you just stay the course, buy stocks every month or whatever and not worry necessarily about -- that's buffet's deal. >> if you really believe

inflation is higher five years from now or even two years, equities are a great investment. and i on the know if that means in the next month they are great. i do think in the next three months and six months and 12 months they will return basically better than historical averages when we just had a pretty big correction with fed sentiment. the bottom, andrew, no one knows but small caps are telling us something else. >> not 75, let's go 85 to 90. 90 to 95 for when you -- >> we're all living longer. >> i'm going higher and higher when a person need not -- >> if you're getting closer to retirement -- >> that's why i said 90. >> i'm not working that long. you may. >> we'll see. how old was andy rooney. who just got signed on the fourth hour of "today". regis. you go. larry king, looking for a

vehicle for his come back. mike wallace. >> i don't think any of them are working because they have to. they are working because they love it. >> like us. >> i think it keeps you young. >> i would be bored. if i didn't work i would be bored. >> i'm always looking for something. >> it doesn't matter how, how lame or boring what the desk gives you. you always are up. have you noticed that. >> i try. >> do you. >> i try. >> you always pull it off. >> i try. it's very kind of you guys to say that but i don't always pull it off. >> yes, you do. >> coming up when we return the clock is ticking for congress to pass a spending bill. pat toomey will join us next on the legislative agenda. oil prices hurting drillers but tanker companies are doing big business. and football is back. we have the highlights from a

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i was going to the library to do my homework. it was a little bit of a walk to get to the bus stop. i had to wait in line to use the computer. took a lot of juggling to keep it all together. what's possible when you have high-speed internet at home? the library never closes. it makes it so much better to do homework when you're at home. internet essentials from comcast. helping to bridge the digital divide. >> welcome back to "squawk box". take a look at futures. dow is opening up seven points higher. s&p looking to open up hire and nasdaq opening up 16 points high

sneerp we're less than three weeks away from the government's funding deadline of october 1st. that's when congress needs to pass a spending bill or face a shut down. joining me now is pat toomey. thanks for being here. what do you think? are we likely to have a shutdown or not because mitch mcconnell said we've seen it play out before and it never ends well for republicans. >> it's unlikely we'll see a shutdown. we'll get a short term extension of law and a negotiated period to agree on spending levels for next year, the basic standoff has been that we passed the budget earlier this year, republicans did and we want to increase defense spending above the level of the caps, the democrats said if you do that we want dollar for dollar increase. that's why we have the standoff. >> and planned parenthood. >> that's an overlay.

>> how does that get resolved >> i'm not sure. i think it will be resolved. i'll tell you one thing, one of the lessons i hope we take away from this it's not a good idea to treat government spending as an on/off switch. we need to find a way, fund the government in incorrectment, divide it into individual appropriations bills and pass them one at a time. then if you have a fight or the interior or appropriation fight you have a fight over that. >> seems you would have a fight over every single issue. someone would have a special interest on one side or the other. >> the individual appropriation bills came out of the appropriations committee with bipartisan votes over the course of this past sum per so clearly there was bipartisan support including at funding levels that your democratic friends say are unacceptable. >> easier to get along with

colleagues in a small group. >> once you cast that vote and on record supporting it it's hard to reverse that on the senate floor. there's things both sides like in any appropriations bill. it makes more sense to have the opportunity to amend. >> there's a wing of your party that says, you know, you got obamacare, zero republican votes. iran deal. zero republican votes. all these executive actions. all of this getting thrown right in your face at you a and forefathers put the power of the purse in a position where that was the last resort rogue actions taken by the executive branch. of course you'll battle they didn't have the media back in our forefathers. you'll get hammered. if you shut down the government you can't use that power any more because you'll get cast in a negative tone by mainstream media. >> it's a power we can't give up. >> it's been given up.

>> my suggestion is you divide -- >> you've given it up. >> if it's all treated as a single monolith that's on or off that wouldn't work. >> what's your slug. separate health and human services? >> there's 13 appropriation bills. there's that. there's the interior bill that funds the epa and on down the line. >> if you were looking at health and human services which is where the planned parenthood issue is now you're talking about defunding the cdc, fda but defunding medicare, medicaid and programs for families with children. >> medicare and medicaid are auto pilot. >> the funding, administration for children and families which takes care of the most abused children and people in the worst positions and i don't think that would play. >> there's an awful lot that's on auto pilot that gets funned whether you have an appropriations bill or not. at some point we have to challenge an administration that's exceeding its legal

authority and implementing an agenda that's completely inconsistent with congressional intent. >> what has mitch mcconnell and other leadership have said? from what i've heard from what they had to say they want to get this resolved. >> that's why my prediction is we'll get a short term extension of current policy and during this, i don't know whether that's three months or six months, during that period there will be a negotiated settlement with the other side which will presumably cover the process by which we'll fund the government for next two years. >> you're on the banking and finance committee as well. we have the federal reserve making a decision this week. what do you think they will do? >> i think we should move to normalizing interest rates a long, long time ago. this is a very unhealthy exercise we've seen to be six years after a crisis and still have zero interest rates. have to be distortions being created in this process. so, i would hope we would begin

the process of normalizing. i'm not optimizing. let's say they move the fund rates that's an incredible monetary policy. i just think we need to get back to normal and sooner -- it's long overdue. >> do you endorse anybody yet? >> not in the presidential race. >> what do you think about the tax plans of the president thus far? >> haven't had a chance to drill down deeply into these. i'm aware of some of the highlights of jeb bush's plan. i think that's the right direction. the key thing, of course, much lower marginal rates. that's how you solve all kinds of problems with our tax code. international piece driven ultimately by marginal rates that are too high. >> would you be prepared to vote for donald trump if he's your nominee. >> i'll be supporting the republican nominee whoever it is. i think it's unlikely it will be donald trump.

>> you'll get somebody some day to say no. i wanted to get him on record. your a supporter of donald trump? >> i haven't picked any candidate. >> will you support bernie sanders if he becomes the nominee? are you a supporter of bernie sand sners will you support bernie sand sners will you? >> i'm not -- >> if you were are a journalist, bernie sanders, a socialist would you support bernie sanders. >> i can't pick somebody. >> see that's what it feels like. >> thank you very much. >> that's what it feels like. >> for every democrat donald trump, a republican has bernie sanders. coming up news coming out of the american airlines, mistakenly flew an uncertified plane from l.a. to hawaii. details next.

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welcome back. some news coming out yesterday that american airlines accidentally flew plane from l.a. to hawaii that wasn't certified to make long flights over water. this mistake happened last month. a spokesman for american airlines said the company notified the faa as soon as they

realized what happened. does it involve like floatation stuff? it doesn't involve -- >> landing stuff, right? >> or air worthiness. is it the distance you have without landing that it needs to be certified for? >> it's the water. >> i'm sure the flight worthiness of the plane is any less than one over land. land or water it doesn't matter. >> a couple of times you don't want to hear oops. one when the dentist has his hands in your mouth. >> or in a republican debate. >> very well. very good. >> did you see -- i like rick perry. >> i do too. >> someone tweeted that he said go on when he released his glasses into the wind. remember he put those on. go on. i don't need you any more. you're sad and releasing.

>> look that's another think that trump called a week or two ago he he was getting out of the race and he denied it. >> three and a half term governor. am these things on his resume, one word oops in the debate. defines his career. >> when we come back this morning it's a good time to be in the crude oil tanker business. industry has seen big profits and outlook for the rest of the year could mean for big bucks for floating aisle. there's a big report coming up next.

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shier is considering options for sweetening its offer for baxalta. they want to put cash in hands sooner. and bank of america is worried about letting moynihan vote. the stept 22nd shareholder tally could go either way. >> did you see barney frank? coming out saying prime should keep both roles given dodding frank. >> he said that he was very helpful in terms much getting the sbc passed. he thinks he's turned the company around. as far as he can tell there's never really any difference, any connection between splitting those two worlds or not when you look at the success of the company. >> i don't know if you guys have

seen this, how far seen this commercial? >> i've seen lots of them. >> there's one where we used to play this all the time for steve liesman. this is the one called europe. you had a poster of europe in your bedroom. was it asia. you had a poster of asia. anyway they actually have -- maybe we have it. okay. check it out. we do have it. ♪ ♪ the final countdown ♪ ♪ the final countdown >> that actually is europe. that is the band europe. >> maybe we can get them to come play for steve. >> europe singing "the final

countdown." final countdown the fed's rate decision, that was a big build up. that announcement coming on thursday. here, you'll see. ♪ >> tanker markets. you screwed the whole thing up. tanker market has had a profitable year and industry is poised for big gains between now and january. >> i think i want "eye of the tiger." i was thinking about the song i want. >> who sings "eye of the tiger"? >> survivor. >> new katy perry tiger thing. >> i don't know. >> "war." >> i'm very unhip with the pop divas these days. anyway let's talk about crude specifically let's talk about crude tankers because in the first half of 2015 rates were very large crude carriers that carry up to 2 million barrels of

oil peaked. by recent rates plunged 70% as demand slowed down ahead of refinery maintenance season. even now the industry gauge the baltic dirty tanker index is down 26% for the year. analysts say with crude below $50 this sector could experience the best fourth quarter since 2008. that as china builds up crude reserves despite a slowing economy to take advantage of higher refining margins. whether citigroup says rates are rebounding up from their august low and with fuel costs low that's a tail wind for earnings and unlimited earnings for new ships coming online next year this could bode well for stocks like euronav, nordic american tanker and dht maritime. other names, teekay tankers and

tsakos energy. another potential positive if iran sanctions are lifted there cube boost. there you go. crude tankers. we have to find something oil and energy related for my song. not "final countdown." >> our thanks to morgan. stick around you can play in this next -- for more on the energy markets we're joined by steven short founder and editor of the short report. good morning to you. >> good morning. >> how are you? you just heard that report. i want to get your reaction to what goldman sachs put out last friday with this idea that somehow barrel could go down to $20. you buy that? >> well, same goldman that a year ago was telling us oil would average $100 a barrel this time around. just because they give their

opinion on this market doesn't mean we can or will go. the key word here is we could go. absolutely. let's address the fundamentals. in the here and for you from a seasonal perspective the pull back in demand from refinery maintenance season is increasing the pull back of a margin 2005 to one. that will only last towards halloween. after that production will don't pull back. right now we have blood flowing in the street in the american oil patch. 70,000 job cuts up through august. now when the banks get through with their credit redeterminations next month and equity for the ep dries up that blood rushing down the street right now will be a gusher. then when you juxtapose that with global demand look what's happened in the past year. china has installed itself, the people's bank of china as the world's largest specialist firm. the majority of the economic sectors in the g7, the brics and

ashanti gears have been contracting. no coincidence that correlates to the pull back in industrial metals. pullbacks in commodities is the canary in the coal mine that something is not right on the global economic scale. >> bottom line it for us. after all that i'm still a little confused. which way is oil going? >> no. i'm painting the scenario for supply will continue to out last demand and, therefore, yes the template is cleared for lower prices. i've been a bear for the last 13 months. i'm still bearish on a longer term basis. we've broken the $40 barrel. we can test the $32, 40 low we saw at the depths of the great recession. we get down that low we can break the $30 barrel between now and fourth quarter. >> i'm a little bit curious when you talk about the fact supply will out pace demand. i spent some time in the oil patch in midland, texas a couple

of weeks ago. one thing i'm hearing if oil stays this low we'll see potentially a dramatic snap back in terms of supply and what's coming out of the ground coming in to next year. what are your thoughts on that here in north america? >> certainly, when we talk about oil production here and the pull back in the enp this is solely a north american story right now. when you start to look at the larger picture which is obviously what we have to do in oil market we're looking at now the largest chasm between sunni and saudi opec. we'll fight saudi and iran to maintain or continue to grow their market share. if you're saudi not only do you have to fight for your market share you have no interest in financing iran's nuclear weapons program and from a longer term basis this is ultimately good for the oil patch down the road because what has been the biggest threat to oil over the past five years? of course the growth of

alternative fuels. so by keeping oil prices in that $50 range which money is being able, can you make money at that point, you keep the entrant barriers for alternatives high. supply will continue to get oil to the market. and, again, we look at china, when we look at the g7, when we look at q3 gdp united states, the fed is only forecast a 1.2% growth. so things are drying up here. why? because things around the globe are challenged at this point. so i suspect that demand will remain subservient to the growth in supply through 2016. >> steven we'll leave the conversation. we appreciate your time and perspective this morning. >> sure. >> thanks. >> sports. sports over the weekend, was there? >> a little bit. >> unlike just a little bit. coming up your "squawk" sports

weekend wrap up. i saw every minute of those friday matches. every one of those men's semi-finals. serena's was interesting. highlights from the nfl. can't wait to talk this guy about jaimes and marcus. and a clash between djokovic and federer. amazing these matches turn on one or two points. unbelievable. we'll be right back. (vo) me? i don't just wait for a moment. i watch for the perfect moment. the one nobody else sees. and when i find it- i go for it. (announcer) at scottrade, we share your passion for trading. that's why we give you the edge, with innovative charting and trading features, plus, powerful mobile apps so you're

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. big weekend of nfl action. some big wins, big upsets and start of what could be a big career for a rookie qb. here with a recap, host of nbc.com sport matters and nbc sports senior vice president. i was thinking, rob, like wow. so big sunday night game. jets or giants, cowboys. oh, no, they are competing with tennis.

tennis fans i don't know necessarily are -- >> i was at the u.s. open last night and there were a lot of people gathered around tvs trying to watch the giants game. there's some overlap. quite a sports night. >> does the quarterback have time to think if i take a sack and it hurts that i run down 40 seconds -- >> i think you're talking about the play last night where eli manning throws the ball on third down inside the cowboys 10 yard line so he doesn't get hit. he end up stopping the clock and giving the cowboys a lot more time to come back. tony romo gets plenty of time. 80 seconds to march down the field. at the end of the day that's a coaching thing because that's got be communicated before you go out on the field, before the play that listen you do not throw an incomplete pass. throw to an open receiver for the touchdown or take the sack. you can't do what they did there and that gave romo plenty of time to march down the field. >> exciting finish. >> it did. not here in new york.

>> i was reading the recap, i wasn't able to watch it. so marcus threw an incomplete pass than touchdown. >> yes. >> then jaimes got the ball and threw a touchdown to the other team. >> exactly. two amazing things happen. jaimes winston first quarterback since brett favre to throw a pick six on his first pass ever. that's an incredible thing to come to the nfl, your first pass is picked off for a touchdown. mariota throws four touchdowns in his first game in nfl. so quite a debut for mariota. winston, he said all the right things afterwards but a rough way to get going. >> every sport has -- >> a deal too. >> that was ugly. >> a bad team.

he came in. >> i like the way the jets looked too. it's better they are separate. rex ryan was a problem. if he can do well in buffalo. >> he's got a lot of excitement going in buffalo. a lot of people thought they would be better this year. they got a win out of home game. >> he has a tattoo on his leg. >> let's talk tennis. >> i was getting to. if there wasn't a djokovic, federer would have 22 majors by now. you can't do it that way. >> you can't. >> djokovic is the best. >> djokovic is clearly the best in the world. federer had as good of a look as he'll get at another major. he didn't lose a set before last night. he comes in not having lost a set. was playing great. djokovic is so -- what happens with djokovic he's so good defensively. he gets to everything. that other players start pressing start going for winners

they shouldn't be going for. that's what happened to federer last night. >> i want to ask a business question. he's a tv business media guy, this is the first year that the finals have aired on espn as opposed to cbs. and espn paid a fortune for these reits. so my question is this year from a ratings perspective are a lot more people going to watch on espn or lot less people. it's an interesting issue. you look at the u.s. open or rather the masters, they are on cbs and they don't care about how much money they get. they just want the exposure. is this good or bad for tennis. >> a couple of things. first of all venus versus serena on espn last week did a 4.8 overnight rating which is the biggest tennis rating we've seen in many years. over and above the men's finals on cbs for years and years. this was a blow-out rating they did with venus and serena last

week. we don't know last night's numbers. there's a rain delay for three hours. that match didn't start until 7:00. espn probably got hurt because they went up against a football game. but cbs was not -- they would have hated that last night. that would have gone into their primetime and a miserable situation. espn was pretty happy in a way to have that match slide back. bigger audience later. but had to face nfl. espn is clearly a good partner of the usta. happy to have everything in one place. we'll see how the audience numbers stack up at the end of the day. >> long term better for tennis not to be on the network? >> network versus cable isn't the distance. i don't think it makes a difference. >> mcenroy is the best. his brother. and chrissy. how great was she? >> their talent choices were

great. i'm a fan. we had chris everet do it. it wasn't -- >> i didn't miss -- i liked it. i knew it wasn't switching back and forth. they kept putting lower third, the baltimore-kansas city baseball game is not -- who was watching the baltimore-kansas city baseball game. okay. >> there are some baseball fans. kansas city is in first place. >> djokovic versus federer. >> a tough night to draw baseball. >> seattle loss? >> seattle lost overtime. lynch in overtime they needed one yard on fourth down to

extend the overtime. they give the ball to lynch. he gets stopped. so they try to run this time. he done get the yard. and that ends the game. that ends the game. so seattle ends up losing their opener in overtime. >> notre dame went from unbeatable texas, they looked terrible. they pulled it out. >> they pulled it out. >> what else have begot? >> listen, i think you got -- >> college. >> washington state. >> yes. >> rutgers lost. >> what is this >> i know. >> they won the week before. >> i hope that money going to that conference -- you knew you were going to play -- you knew you were going to have to play these teams. >> i don't have to get on the field. >> you have a bunch of team -- >> i would call in sick. >> plenty much teams still alive in the playoff. i think nfl first week is always, tough to figure out. >> bengals. >> what's real, what's not real. you got to look at opponents.

look who the jets are playing. look who the bengals are playing. is this real? does this mean anything? we'll look back on this at six, seven weeks they had a weak opening opponent. >> they asked miss america from georgia whether tom brady cheated and she said yes. how controversial. >> it's that or world peace, right? >> have you seen the insurance ad of that? i'll tell you about it. i won't mention it on air. >> great to see you. >> always a pleasure. >> when we come back some big movers ahead of the opening bell. later iphone pre-order data showing stronger than expected demand, especially in china. we'll talking to an analyst about the numbers.

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took a lot of juggling to keep it all together. what's possible when you have high-speed internet at home? the library never closes. it makes it so much better to do homework when you're at home. internet essentials from comcast. helping to bridge the digital divide. let's look at a couple of stocks to watch this morning. raptor pharmaceuticals is getting hit hard. the company is discontinuing or might discontinue development of an experimental liver drug after it failed to meet the main goal in a second mid-stage study. h&r block was downgraded from neutral to buy. it's being upgraded to buy at goldman sachs. nokia was added.

valuation, synergy and capital return are attractive. marvell downgraded to equal weight at morgan stanley. marvell is owned by -- have to be marvell. cites an investigation into accounting issues that was announced on friday. so no tv. you could watch tv but you're -- >> i was at dinner. big family dinner. >> what if there was a tv at the side, like in the corner. >> one of my cousins was running off to check the scores here and there but -- coming up -- >> is that kosher >> that's probably not kosher but we won in other sports. coming up the countdown to thursday's fed decision is on former treasure secretary under secretary john taylor say they should raise rates. the key question is will they.

tune in to "squawk" to find out the answer. we'll be back in a moment. can a business have a mind?

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fed ache.

>> i got a headache this big. >> what investors can expect and where you should be putting fwhoerng after the big decision. our market panel is ready to share their investing thoughts. john taylor. >> cashing in on the catwalk. why wait for designs to hit the store when you can buy them off the runway. how the co-founder is disrupting the world of fashion. could mark cuban crush donald trump in the race for the white house. the billionaire emailing cnbc some cheeky comments about the race. we have those comments as the final hour of "squawk box" begins right now. ♪ the final countdown >> live from the most powerful city in the world, new york. this is "squawk box". welcome back to "squawk box" right here on cnbc first in business worldwide. i'm andrew ross sorkin with becky quick and joe kernen. we're less than 90 minutes away from the opening bell on wall street. take a look at the futures. things have been up and down.

we'll call things relatively up. dow moved from negative to positive. same thing on s&p 500. nasdaq looks to open higher about 8.5 points hire fup look what's going on in europe, we have a marginal down arrow across the board and then take a look at oil prices at the moment. we'll put that board around and you'll see what's going on. wti crude, 44.41 but a couple of investors and analysts saying that number is going down. goldman sachs with the scary call of things going down to $20 a barrel. >> let's get you caught up on other stories. robert schiller says growing number of investors believe u.s. stocks are overvalued. the nobel prize winning economist argues this creates the risk of a significant bear market. however, tom lee told us a bottom in stocks may be in place. >> some things you look for to say bottom is in are usually

small caps out performing. almost always turn up one day to two weeks before the actual bottoms in. >> is that happening? >> small caps bombed versus s&p on 24th of august. >> disappointing economic data out of china put pressure on stocks there overnight. in the meantime government officials there announcing beijing will work to reform its state-owned enterprises and introduce what they call mixed ownership. shanghai composite closing down by 3%. the index dropped as much as 7% at one point before coming back. >> barons says alibaba could lose another 50% of the value. the stock is trading about 25 times the average earns estimate from analysts and argues that number should be closer to 15 times like the multiple of e-bay. now alibaba is fighting back

posting a letter to barron's editor. he says the article contains factual inaccuracies and selective use of certain information and the conclusions the reporter draws is misleading. >> the letter is five pages. it's good. there were parts that were compelling. hard to say which side is right. >> we are just two days away from what could be the most highly-anticipated fed decision on interest rates in over a decade. joining us right now to give us their perspective is michele girl regard chief u.s. economist at rbs. michele, tell me what you think will happen. will they raise rates? looks like we're having some problems hearing michele. michele you must be able to hear us. give us a moment. ed we made the argument or i made the argument no matter what happens the market is going to be dissatisfied with what the

fed does. that you got half the market. basically a split. there hasn't been clear telegraphing. no matter what happens half the market will be disappointed. >> from purely the market's point of view best thing is to raise rates but simultaneously say they are done for the rest of 2015. so you would satisfy the people that to see some kind of an increase but at the same time give some certainty about the future course of rates which that uncertainty is causing most of the angst. >> i have a hard time thinking the fed will saying we're one and done. they don't want to box themselves in. >> they can hedge a little bit unless there's some extraordinary data. i think you want to give, being a great if the fed could give a little bit of certainty of what the course might be over the course of the next couple of months and then we'll say in 2016 revisit the data and determine what the future course would be. >> where do you think they are focusing or what data points are they focusing on.

job numbers have been very good. auto sales have been very good. things on the other side of the ledger -- >> the main thing is that inflation is still well below their target and isn't moving towards it. so i think that's the focus of their attention. also i think it's fair to say from various comments though they are considered the global consideration. they do consider what's happening in the market. not a primary but a secondary one. they made it clear they think of a lot of different things. most important is what's the labor market conditions which is getting much better and then what's inflation. inflation has stayed low and looks like it's dropping. >> we're still working on michele. ed, just in terms of the market we had a lot of people who have come on and talked about things in the last week. last week, we could be looking at a huge change that's taking place. reserves are starting to dry up after pouring in for a long time. that could be almost a

generational type of shift. >> i agree and disagree. first of all that selling of treasuries by china and brazil which basically what you're talking about, he's correct but there's enough demand from baby boomers and institutions that serve them to soak up that demand. >> baby boomers are going to be buying as much as china is selling? >> if you look at the numbers there's trillions of dollars outside of the united states. not all of that will be sold. look at the price. if you would think that the sales which are already taking place by china and brazil would have an impact we're still about 2.2%. there's plenty of demand for high quality long duration assets and i think there's some concern about what earnings will do. we know margins are quite high. growth is close to zero. earnings growth is expected to rebound but rebound is based on energy earnings rebounding. you probably will see a

market -- while we're still in a global market but the pace will be significantly slow over the next couple of years than last several years. >> what do you think about the market's evaluation with the correction, with the pull back. >> i think stocks are pretty fairly valued here. i think you'll see, again, we're still in a bull market but the pace will be more like kind of 7% total return not double digits we've seen or double digits we've seen in the last 0e years. >> you still buy on dips and you hold off in between? >> what we've been doing right now, we did buy -- >> is this a dip >> we did buy a little bit. not tremendous. but we did buy. my portfolios today were around benchmark weights for stocks. we're not being tremendously aggressive. there's not a tremendous amount of conviction on our part based on slower earnings growth. at the same time i think we'll still see stock prices rise. >> are you on benchmark evaluations for things like

stocks? for things like bonds? what about cash? >> i hold a little bit more cash than i normally would and that's partially because if you do get reaction from the fed and what's happening in china i want dry powder to put to work as we did that day when the dow opened 1,000. we were buying that morning. >> ed i want to thank you very much for coming in. our apologies to michelle g ira rd. when we come back this morning you like what you see on the catwalk. "vogue" contributing editor has created a fashion paradise for those who can't wait for it to hit the stores. you have to pay up. a woman joins us after the break to explain that. rose gold is the hot color right now for apple's latest iphone. we'll talk pre-order numbers and how long i want will take for you to get the latest versions. "squawk box" will be right back.

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welcome back to "squawk box" this morning opinion new york fashion week is full in swing bringing the spring collections of designers to runway's and luxury retailer offers right off the runway looks to the shopping carts of coveted high net worth shoppers. we have the co-founder here and "vogue" contributing editor. welcome. >> thanks for having me. >> tell me about this company. you can buy stuff -- you can watch it on the runway and go online and buy it. >> absolutely. used to be fashion week was reserved for a small elite few department store buyers, magazine editors, maybe actress, socialites. and it was really closed off to the rest of the world. so what we did we enabled our customers sit front row, see everything that goes down the runway and pre-order it. >> i thought they weren't trying

to sell a lot of the stuff. >> obviously they would like to sell a lot of the stuff into the right people. absolutely will help them do that. >> are they thinking this will help their sales and stuff they make for runway >> actually what's interesting it gives a really interesting end customer feedback. our customers are responding saying what they are like, what's working. so immediately the designers know what went down the runway and customers are responding. >> sounds there's an analog digital component. you're putting your customers in the seats. >> in the proverbial seat. >> proverbial front row by watching online. >> watching online and pre-ordering online. >> what is the cheapest garment you're selling? >> we found our niche. we're doing high luxury. during fashion week our average order is around $7800. >> for $7800 -- you would think at a certain price point there

would be a dynamic at which you would actually want to thereabout. >> you would think. i would love to say i was surprised. i know how the luxury customer shops and there are certain things she can't get anywhere else. if it means putting 50% deposit down and waypointing for that item to be produced for you and delivered to you, it's something she can't get anywhere else. >> you say that people are immediately saying what they like, the designers get instant access to that. i'm guessing people say what they don't like. >> some things sit on the side and get no fraction, no response. our customers are savvy and it's interesting they really pick up on what's good. if it's a great collection or a new designer we see them responding. >> when i say there are things on the runway that i think are for sale i imagine there are certain pieces that are show pieces that aren't necessarily the things they expect the guy at saks to put on the floor. >> a lot of things you'll see

going down runway people go who will wear natural? you with embellish, really high fashion items. those are the ones that yes wouldn't get produced unless our customer specifically requested it. >> who are your customers? are they new york? china. >> it's international. we ship internally. she's either working, wife, 36 years old, has multiple addresses. usually around the world. speaks multiple languages. and is really interested in things she cannot get anywhere else. >> does she put the order in or assistant? >> it depends. we've seen everything. we've seen $300,000 sales done over text message -- >> wow. >> how many customers do you have? how much money can i ask? i know it's a private company. >> it is a private company.

with 7800 average order value, we're definitely, we're five years old. we're going to turn a profit in the near future. we're very successful. >> always planning on staying in this niche or in terms of growing business. >> absolutely. >> do you have to go down market at all? >> i refuse. our customers -- no one else is servicing her online especially in the high fashion area. this is really our niche. it's where we belong. it's where i'm obsessed. >> selfish file question. we always call the customer her are there any men's clopting. >> we're able to make things in specific sizes. so whether a swoom large size or has a small shoe we can accommodate her. yes. we've had ostrich shoes made in men's sizes. we've done special things. >> you're so involved and

engaged in this interview -- it's like fascinating. >> like the sports guy. >> to see you that engaged, we need to book more things like this for you. >> exactly. >> what we're interested in. ostrich what? >> ostrich skin trend. >> up immediately want to bury your head -- >> do you think fed interest rates will go up and down -- >> with the hem lines -- isn't that how they determine. >> that's good. what are they >> down. coming down. >> a correction. okay. thank you. >> appreciate it. >> thank you. >> coming up, facebook, can you actually get -- i would like to -- those are like happening places the front row of those place. >> but she's only getting -- >> i can get you in. >> you like the watch. >> i can get you in. >> you want to touch for 7800.

facebook wants to bring virtual reality to your smartphone. that story is next. economics professor john taylor on why now is the time for the fed to move on interest rates. later is mark cuban thinking of following in the donald's foot steps why he says he can beat the republican businessman and hillary clinton, meanwhile take a look at futures right now. and they are now down. they were up 50 earlier now down 18. been a turn around. we'll be right back. i'm watson. and today hundreds of companies are putting me to work. i'm teaching watson to help your vet speak dog. you're a dog, right? i'm teaching watson to help you make healthy choices.

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me interviewing me, that's what i call a great idea. [ laughter ] >> of course it's a great idea, we thought of it. [ laughter ] >> are you ready for the republican debate? >> it's really going to be a big debate but i'm always ready. >> it's not just big, it's huge! huge, huge, huge, huge, huge. [ laughter ] . [ applause ] . >> that was donald trump joining jimmy fallon on the "tonight show". friday the video going viral. in other political news donald trump blasting high ceo pay as a joke calling it a disgrace. here's what he had to say on "face the nation" yesterday. >> it's a shame and it's

disgraceful and sometimes the boards rule but i would say it's less than 10%. and you see these guys making these enormous amounts of money. it's a total and complete joke. >> it's complicated. >> is there anyone else that can tell "face the nation" or "meet the press" i'm calling you on phone and you'll be happy. i'm not coming in your studio. you want me i'm going attorney. that's as good as it will get. okay mr. trump whatever you say. unbelievable. isn't it? he did go on, though, on the "tonight show". >> yes. >> if he started calling in i would say something else. >> what do you make of the comments. >> he says great stuff all the time. it's very positive. >> it's very populace. >> among liberals they love the pope now and liberals love the stuff donald says.

when it comes around to it, all the liberals will convert to catholicism instead of atheism and they are going to vote -- >> the more you see donald behind a podium with the american flag behind him the more presidential he looks. >> the more he reads the ceo pay issue. you're right more presidential he looks. more sanders-like or presidential more bernie sanders. >> no comment. >> let's talk about the fed and focus this week. joining us once again is michele gerard. i hope this is working. let's try this one more time. what do you think the fed will do. >> up and ed covered a lot. i thought very much along the lines of what you discussed. we think they will end up going but try to shall that that could be it for the year. you raised a very good point,

becky. it isn't like they are going to come out and say that's it guys we're done. but i do think that they can ren fo reinforce the point that rate hikes are not on a pre-determined path. they will raise the question assuming another rate hike in december may be too soon they may do that, for example, the dot plots may show that the majority of them feel that one hike this year is appropriate. so i think -- i think fed would rather be in a position of even though it will be painful to hike to talk soothingly to the markets perhaps for the rest of this year as opposed to not going but then we have to have this hanging over our head for the next three months. >> the journal lays out a good piece today that describes the central bank tried to raise rates in the last several years and have stumbled and had to give up along the way. they pointed to the ecb, they point to israel, they point to

sweden. there were a number of missteps with central banks that tried to do this. >> are these missteps or just going to be how this cycle ends up playing out for many central banks as they emerge from a period of prolonged accommodation. we're so used to when we have hiking cycles we go off. when we have easing cycles we go down. this is a very different circumstance. it wouldn't surprise me at all if you get not the set step path of higher interest rates but you get a move and then maybe no move for six months and then maybe another move. at some point the fed has to reverse. i think it's going to look -- this whole cycle. >> reverse? that's what the ecb had to do. >> exactly. i don't know in the end if that necessarily means that making the move up was wrong. in the ecb's case it looks like that. but this fed has to respond to

evolving situations. they have to be as forward looking as they can. i do think as we talk about sitting at zero most of us feel probably not correct. i know it's not going show itself in inflation but in other ways i think this misallocation of resources because rates are too low is problematic and that's what i think -- >> bubbles in places. >> or maybe you're not seeing proper economic decisions being made. people aren't investing in technology, for example, because they are encouraging shareholder friendly activities because the equity market has been such a beneficiary. again, these are things that we don't know now but fundamentally i think is why i would like to see the fed begin to move rates off the zero ground. we don't need emergency rates any more and i think the economy can handle it. >> what you just laid out is a case for more volatility, not knowing what's happening, being in unchartered territory, not knowing if we're going six months without a rate hike or

reversal. that sounds like a lot more volatility. >> it may be. may ultimately be that way. doesn't necessarily have to be. let's face it, rate hikes are not nearly as fun to execute as easing monetary policy but the fed has to step up and do the right thing in here and i think if they show leadership and confidence then the markets are going to ultimately be in a much better shape. the fed cannot be beholding to markets. >> michele thank you. coming up we have the countdown. economics professor and information treasury secretary for international affairs john taylor will join us after the break. with centurylink as your trusted technology partner, you get an industry leading broadband network and cloud and hosting services. centurylink. your link to what's next.

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everyone. here's what in our headlines. big political news out of australia. ruling liberal party votering out tony abbott as prime minister. long time rival winning the role. >> i met him years ago.

i covered the olympics in sydney, australia and went kayaking with him in the sydney harbor. >> you're kidding. >> goldman sachs vice chairman. >> let's tell you about corporate news. check out shares of raptor pharma. they may discontinue development of its experimental liver drug after it failed to meet the main goal in a second mid-stage study. gas prices plunging. the average price of a gallon of regular unleaded is now down 27 cents a gallon. nation's average 2.44. we've been talking about facebook. bringing a virtual app to let users change viewing aspect. it's in stages of development. mark zuckerberg has called servir tall reality the next executing platform. a year ago facebook made that big bet on the virtual reality

head set. markets are waiting to see if central bank will raise interest rates or not. john taylor says now is the time to move and he joins us now to tell us why and i think it's similar to some of your reasons you high liked in the past, professor. and in guess is it overstating it to say you think we're already behind the curve in terms of normalizing rates? >> no, i don't think it's overstating it. i've been arguing we should be normalizing, getting back to policies that work pretty well. i think the economy is ready for that. of course, there's always worries about turbulence as it moves. you heard a lot about that in the last few weeks. but if not now when? i think basically be good for the economy again, looking for short run turbulence. but there's been so much discussion and so much back and forth at this point i think it wouldn't be a good idea to

postpone it any further. >> i'm sure that you don't need to read the journal or the article in the journal today to know that in the past few years the results of countries that have raised rates, it has not been hasn't worked out in most cases and they had to bring rates back down. do we have a different situation here -- if we knew we were going to do that we shouldn't raise them, i guess, right? >> yeah. i think one of the reasons the fed has delayed is they are concerned about having to move back again. always a concern for a policymaker, you move in one direction and you got to back off of that. that could happen but i don't think so. actually in some sense if we were back to a more normal monetary policy there would be more flexibility if the economy does weaken again. but the macro fundamental indicators it's about time and i think the debate really is more

whether the turbulence in the last few weeks coming out of china and other parts of the world, is a reason to slow down on this. a lot of people argue that's why you see so much disagreement within the fomc at this point. if you keep delaying, always going to be a reason to delay. always a reason to postpone, then you don't do it at all and i think that would be more disruptive to the economy. >> looking at the global savings glut whatever you want to call it, whatever larry somers, whatever term you want to use, do we have to recalibrate what normal is in terms of what normalizing rates at this point is. nobody thinks they will go back to 5%, 6%, 7% or any time soon. >> i think it's a good debate to be having. i don't see the reason. we're also way below that, no matter how you do the

calculations. getting back to a more predictable context, in the discussion how we should be going, it's good, it's healthy. i don't think it's a reason to delay. by the way i think part of this debate about long rates has to do with the so-called secular stagnation. is the economy in a funk? we'll never get back to high growth. in disagree with that. i think a good change in policy will heed to higher growth. to some extent it's part that. getting back to the kind of policy that worked quite well in the '80ss and '90s until recently. >> the sheer size of the balance sheet and balance sheets around the world or money that has been, you know, not necessarily -- it isn't in the system yet but ready to go if people were to borrow it, is it going to be a problem

technically to try to sop southern plains of that up. will it be expensive for the federal reserve to do that? >> they are going to have to pay more interest on reserves to the banks. there's a lot of reserves. they have this other method the overnight repo trying to help them with that. until the balance sheet does return to more normal levels it will be a while they have to use these other methods like paying interest on reserves. we don't know how it will work. they have to do that in the meantime and they are talking about it. that's good. they are describing how it's actually going to work, some of the mechanics the markets need to know about. >> they said they've never done it and ready to work and prime vice. in read that and -- should i take solace in that? we know exactly -- go ahead. >> it's been a concern of the

global balance sheet how we'll get back. they laid it out. they looked at it. they experimented. they have some experience back in 2008 when the rate was moving down. now it's going to be moving up. ate little different. i think it will be fine. but they have to do it. they have to make the decision and we'll see what the reaction is to that. i think ultimately it will be a positive and continue with this until they do bring down the balance sheet again. >> hem lines are headed lower. in the past that means a down market. now i'm worried. i got a lot of things to worry about now. right? in the past. weird -- loud lipstick. weird it's coinciding with the first move with fed. john taylor, thank you. don't know if you have it in your quiver. that's another thing to consider.

see you. thank you. when we return, pre-orders of the new iphone. and mark cuban on the race for the white house. how he would run a campaign and what he thinks of donald trump and hillary clinton. "squawk box" will be right back.

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. welcome back to "squawk box". apple ceo tim cook will ahear on the late show with steven colbert. colbert announcing that news via

twitter showing the guest wearing his apple watch. siri put apple ceo tim cook on my calendar for tuesday september 15th. oh, and come up with some questions to ask him. >> put apple pie on my menu list. i'm never using her again. you think it's getting better. >> let's see if we can do it. siri, ten questions for apple ceo. we need a question for tim cook. >> i'm sorry i'm afraid i can't answer. >> the interview will be cook's first appearance on the late night network talk show circuit. also we should tell you about apple's latest iphone. >> apple's latest iphone is available for pre-order over the weekend. josh lipton joins us with the

details. josh, good morning to you. >> reporter: apple investors this morning waking up waiting to hear how those pre-order. we just got some color for apple. leapt me read you customer response apple saying to the iphone 6s and 6s plus has been extremely positive and pre-orders this weekend were very strong around the world. we're on pace apple saying to beat last year's 10 million unit first weekend record when the new iphones go on sale september 25th. as many customers knows apple went on to say online demand for iphone 6s has been strong and exceeded our forecast for pre-order period. we're not getting the same number we did last year. apple said last year they got 4 million for 6 and 6 plus in 24 hours. that was a new record. there's a lot of bullishness on the street about this weekend about this launch. i was talking to pipers, an

apple bull. these pre-orders benefitted from new tail winds. one the launch of more countries. china this year, new zealand. also carriers. at&ts and verizons incentivize people to upgrade every year. it's not just a headline. it gives you some indication how this 6s and 6s plus is being received. that's the biggest question for investors with these new cameras, faster, improved camera in these phones. that's going to really be the big issue for investors. will that be enough to really move grow iphone units in december and quarters ahead? guys back to you. >> josh thank you for that. let's bring in the managing director at bti research. is it enough to get people excited? >> doesn't seem like it's enough from a hype standpoint but from

functionality how people use siri and touch i.d. or 3-d touch. >> huge piece. on the cover business week last week about this. really talks about how much time and money was spent to build this technology. they seem to make the point it's a subtle technology not talg that would force somebody to run out and buy it. >> josh talked about that in a video or in an interview. what he said also is it's going to change how people use the iphone. it's true. one of these things you'll use every time. you'll access your apps more quickly. it will save you time. that's the thing people care about. >> i got to say i'm surprised with these numbers. it's going to be interesting to see how investors react. apple could have said nothing or they could have put out a hard number that compared 4 million, 24 hours last year to whatever they did over 24 hours this year. they didn't do either one. last year they opened up with 10

different countries. this year they have 12. they headed new zealand and china. we would have expected that the numbers, they would be on pace to beat last year's opening weekend numbers. i don't even think they are comparing pre-orders to pre-orders. they are saying based on pre-order our first weekend of sales will be at least as good or probably better than last year >> you're saying it's not apples to apples. >> they are not saying a lot with this release. maybe they don't want to set that precedent. >> who knows what first weekend sales are. last year it started on thursday night. because of the late labor day it started on friday. they have to wait through tend of monday to find out what the number will be. >> they are talking about they are on pace so that first weekend of actual sales. we're talking late in the month, what is it september 26th. >> yep. >> september 25th. >> projecting out to there what

numbers will be. they are not counting pre-orders. >> pre-order number how representative is that in terms of what the fall and into the christmas season will look like. if it's huge out of the gate -- >> take that number over the total number of pops and the ratio is such a minimum as far as what they end up selling in december hard to draw any type of correlation. hasn't bean year where it's up and down. to say it was down this year and ended up to be huge quarter. other thing people focus on this thing sold out. over twitter oh, my god phones are still available but the reality is they were available for several days last year. it's not like these sell out in minutes or hours. >> i want to ask you about apple tv and the watch. the watch has not sold tremendously well thus far. we don't think that. >> you don't have one. it's not sold --

>> sold tremendously well compared over tory other wearable app. >> until he gets one it's a failure. >> that's not what i'm saying. >> you going to write a blog -- >> given the price point of watch and apple tv that that becomes one of the great holiday gifts of the season. do you buy that argument as a watch? >> it could be. go prowas supposed to be holiday gift. it sold a couple of million units. i don't know what a holiday gift drives you. >> the watch will be doing well. people are buying the phone if your significant other got the 6s, 6s plus what am i going to get them for christmas. get them the watch. i also think that with this watch os 2 update coming out in a few days there's some things they need to get right with that. apple tells me they have been

working on some things like the apps. working on tweaks to get it faster and complaints -- >> it's usually slow using external apps. >> the weather which is a built in app that's slow for me. pretty consistently. it's faster for me to take out the phone and tap the weather app than get it on the watch. things like that you want to work better. >> walk us through your concerns to the extent you have them about china right now and apple and their market share. >> my skeconcern is i don't kno. i'm not an expert on china. when the stock market took a dive and cook came out and said everything is fine that's great but until we actually see the numbers flow through it's hard to know how a person in china is perceiving buying a phone. it's more expensive there than here because of the taxes. >> china is extremely important for apple but also important is the fact that apple is building out its retail store base

aggressively despite worries people have. they are investing in the future there. they are launching this phone in china at the same time this year is important for them. so probably for investors it's the long game, apple's long game in china. >> how often do you switch >> pretty much never. >> how many bands you got? >> i have two. >> how often do you switch? >> i don't switch any more. in used to switch. >> you buy the -- >> me? no. look at this. do i look like i'm there? >> you do. >> yes, you do. >> cook put his reputation on the line by sending cramer the e-mail saying china is fine. if the numbers don't deliver through that's his reputation that's on the line. secondly to see the chinese, you know, there's a report saying sales were out in china, that's another positive sign but, again, it doesn't flow through

then it will create more uncertainty. >> thank you. appreciate it. coming up next when we return in mark cuban's words i crush trump the billionaire telling cnbc how he would structure his campaign plus thoughts he would structure his campaign, thoughts on hillary clinton and more. check out the futures right now at this hour. you're looking at a mixed picture. dow looks like it will open low lower marginally.

news this morning. a new "washington post" poll finds that hillary clinton and donald trump are separated by a three-point margin. 46% of registered voters chose clinton, 43% chose trump. the republican candidate also hit the stage wednesday night ahead of their next debate. trump is leading ben carson and jeb bush. >> mark cuban telling cnbc he would crush a donald trump if they were to run head to head. at the end of this, we have donald trump, mark cuban. if you could just update whether kanye said anything, or any

other people that might be -- i haven't decided yet. larry kudlow may do something with the senate. everyone can be a superstar in hollywood. >> but not everyone is a billionaire. mark cuban said he has no plans to run for office but he's been inspired by this donald trump campaign. he thinks trump is somebody who has broken all the old rules and you don't have to have a perfect past to run for political office. he said the idea of a presidential campaign is a fun idea to toss around. here's what he told me. look at some of his quotes that we have up on cnbc.com. he said if we have a three comma p otust would not take long before the office humbled him or her. he also said if he was matched up against hillary clinton or donald trump, he said he would beat them. he said if i ran as a dem, i know i could beat hillary clinton. if it was me versus trump, i could crush him. here's the issues on mark

cuban's mind. important to him are the idea of income inequality. he would want do something about that. do something about college debt as well as overly complex taxes. and cybersecurity and broken equity markets are key, as he thinks about what this country needs to be doing going forward. he said the equity markets are being taken over by stock market hackers. to me, all of this sort of brings up this important question in american politics now, which is that if donald trump has done nothing else, my guess is that what he's done here is sent a signal to other billionaires across the country that you don't have to sit on the sidelines. you don't have to be a donor or a fund-raiser or somebody rallying support for your favorite candidate. you can cut out the middle man and run yourself. my guess is we'll see more billionaires running in 2020 than in 2016. >> ross perot ran. pat paulson ran. he didn't get far. >> perot i remember. >> perot was spoiler. he made a big difference.

>> he made a difference as a spoiler. not as a potential president. >> he made a difference in who got elected. >> howard schultz. >> with the resources, and cuban says with the arrogance, he might want to look at this and say i can do this. >> difference between running and getting elected. >> big difference. when we come back, scary statistics on student debt. a shocking number of people defaulting on loans. details next. plus our 20th anniversary of "squawk box" continues. we'll mark the milestone for the show for all you trivia fans out there. check out these names from back in 1995. these are companies that went public the same year that "squawk box" launched. stick around.

excellent looking below the surface, researching a hunch... and making a decision you are type e*. time for a change of menu. research and invest from any website. with e*trade's browser trading. e*trade. opportunity is everywhere. 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. hey! hi! our cloud - it's a platform based on awesome-ization! really? can it keep our data where it needs to be no matter what country we're in? integrate with our systems to help keep transactions secure? combine customer data with likes, tweets, the weather, to predict trends? that would be awesome. tote? now there's a cloud that understands business. now there's the ibm cloud. it's more than a nit's reliable uptime. and multi-layered security. it's how you stay connected to each other and to your customers. with centurylink you get advanced technology solutions,

including an industry leading broadband network, and cloud and hosting services - all with dedicated, responsive support. with centurylink as your trusted technology partner, you'reree to focus on growing your business. centurylink. your link to what's next. . welcome back. it's no secret that student debt is becoming a huge issue in the country. now the "wall street journal" is analyzing data. the paper finds that more than half the students at 347 schools defaulted on loans or failed to pay back anything after seven years. many of the students went to for profit schools.

students in those schools received $2.2 billion in federal loans last year. our 20th anniversary celebration continues tomorrow. we'll have a conversation on the future of college education with administrators from georgia town, arizona state, also former senator bob kerry. >> that's tomorrow. join us for that. "squawk on the street" is next. don't say it, we'll sound old. >> good morning. welcome to "squawk on the street." i'm carl quintanilla, with michelle car ruuso cabrera join us. the bulls will try to build on the do youw's best week. europe is having a slightly beer