not the day. >> still 24 hours. >> "worldwide exchange" begins right now. ♪ love shack a little place where we could get together ♪ >> announcer: live from new york where business never sleep, this is "squawk box." good morning, everybody. welcome to "squawk box" here on cnbc. i'm becky quick along with joe kernin and andrew ross sorkin. fed chair janet yellen remains positive but she did not say when a rate hike will come. the s&p 500 closing at its highest level this year. all the way back to early november since we've seen a close like this. check out the u.s. equity futures at this hour. you're going to see at least right now in the early trading, we are looking at pod numbers once again.numbers continue to close higher. dow futures skated 67 points.

nasdaq up by close to 20. overnight in asia, the nikkei up by 0.6%. the shanghai deposit was flat. in europe, some of the early trading, you're seeing those positive gains are continuing here the dax is the biggest gainer of the major averages up by 1.7%. the ftse is up 0.6%. >> they finally decided if the economy is is not going to get better, at least we got glory. >> you almost heard both messages from yellen. the economy is doing okay. >> she wants something to confirm in one number, i don't think one month would confirm. >> july, like 20% now. >> i think it's still on the table. we also want to see what happens with brexit. >> for eight years it's been --

look. the economy hasn't really been getting any better but we got the free money. we've got the low rates. let's buy stocks. that still works. >> there no alternative to move, right? >> yeah. >> there is some corporate news. some corporate news, not so great news for yahoo! this morning. verizon going to submit a bit of only around $3 billion. "the wall street journal" also saying going to submit that for assets. yahoo! expected to hold at least one more round of bidding. unclear still whether dan gilbert who was in the news getting involved with warren buffett, whether he's still bidding or whether other bidders are still in the mix. but that is the latest on that.

on the yahoo! auction, if will you. apparently, by the way, there were presentations that was made about a month ago, and they did not go well in terms of showing how fast the business has declined. >> it's a scary thing. the other piece of tech news this morning, got to go to asia for this one. apple selling a 30-year u.s. dollar bond in taiwan at a yield of 4.15%. i don't know if you guys want to get in on this deal. 4.15%. apple -- >> how low -- how many? >> 30. >> thank you. >> issues in the taiwanese markets by multinationals. intel has done bond deals there. anheuser-busch. inbev looking to raise it on what it the first issue of debt in taiwan. >> you don't want that? 30 years? >> 30 years from apple.

>> no way. that baby could be on the sixen generation replacement for iphone -- i mean i have no idea. 30 years? three years i have no idea what we're going to be doing. >> you means just in terms of technology companies? >> like the glasses from yesterday. thinking about when i want to search the web and it's going to suddenly appear on my glasses as i'm doing other things. >> 4.15% is not enough. what would be a fail rate for 30-year money? >> two risks there. number one, low interest rates, 4%. you wouldn't want that on aaa five or ten years ago. number two, i don't know whether they're able to pay that back. i have no idea whether it's going to be apple or not. yeah, i'm going to be there. definitely, hef made it. hef made it to 90. still getting it done,

apparently. >> by the way, my grandfather sold his house when he was 65 on a 25-year promissory note and lived to collect it. >> there you go. there you go. >> how old this latest squeezy the reason i'm looking at this, i'm trying to figure out why this would cause this stock to go up. i'll just tell you. the wires are very straightforward. the shares are sarepta therapeutics soaring after the fda asked for more information on the treatment of muscular dystrophy. the agency delayed a highly anticipated decision whether to approve the drug last month, after an advisory panel determined it wasn't effective. >> if you're ask for more information, you're looking for a reason for yes even though you'd be going up against the fda panel. >> it's still on the table, apparently. that's a pretty big you've,

asking for additional information. in other indications if something is supposed to be imminent for approval and you ask for more information, sometimes, the stock will go down. >> but that stock went back in january. and alexion pharmaceutical drug misses the goals. it's for a debilitating neuromuscular disease. >> which girlfriend are you talking about, i just googled it. >> i saw it in "the post," hold on to your seat, she's blonde which is a shocker for hef. that's not a girlfriend it's his wife.

good for him. her name surprisingly is crystal. he is 90. and he gets to stay in the mansion. the guy who bought that mansion is the owner of hostess. he's 32 years old. he owns the place next door. and he's going to turn it eventually into one -- and it's right on the lake. really in the south. they've got to update it. definitely got to update it. >> i've seen some of the pictures. >> leave the room with the bouncy floor. the big party room. i guess it's for tap prampoline. i don't know. >> i. a u.s. judge has freed

gilead from paying assets. it applied for the patents including lying under oath, and other unethical practices. we should also tell you about global market news. a new brexit poll finds that the leave campaign is coming up. the 47% of voters voting for leaving the eu. at times, yougoff poll say 45%. and let's check out the currencies this morning. the dollar is down against the euro at trading at 1.1366. it's up against the yen. the pound is right at 1.4566. hillary clinton clinching the democratic nomination with major primaries taking place in

six states including california and new jersey. john harwood joins us in the studio. your siri just went off and said, sorry, i didn't get that. like bernie sanders, sorry, i didn't get that. >> the interesting thing when is bernie sanders going to confirm the ap delegate count. he said overt weekend it would not be accurate if journalists said hillary clinton after tuesday had clinched the nomination with enough delegates. >> and superdelegates right? >> yeah, but the argument doesn't make any sense because she has more votes. she has more pledged delegates and she has the superdelegates. so if you say -- but he's not going to do that. this thing is over. president obama is pushing it toward the finish. everybody is ready to get their act together against trump. and this is a week when trump has reminded democrats of why

they -- >> so handicapped. will he capitulate this week? >> i think within a week, bernie sanders will be out. >> will hillary clinton win california? >> yes, the clinton campaign expects to win california. we'll see if that happens. but i don't think he can sustain the argument that he's making which is a very weak argument for very long. and so, i think that the combined pressure from the white house, from fellow democrats who are saying what are you doing. >> a bigger question, does he throw his full support behind hillary clinton. >> because i heard commentary from him yesterday, bringing up all sorts of situations with the clinton foundation. he's not doing it from a positive perspective. he's still going at it very negative. >> well that's the right question and we still don't know the answer.

i think president obama has some influence on it. he said over the weekend, it's going to be a contested convention. that's kind of war talk, right? you just don't have that when somebody has conceded the game. now, everybody talks bravely until the moment they get out of the race. right. ted cruz a few hours before he quit his campaign said i'm going all the way to the next states. we will see what happens. but obama does have a lot of appeal to sanders voters. and that's a way for hillary clinton, even if he -- if he decides to go out with every gun blazing, that will not be good for the democrats. but it will be mitigated somewhat by what the president does. >> i think the president -- i think they go to the same socialist meeting every month. i think they talk things over while they're kicking around the latest in socialism today. can i clarify one thing? >> sure, no, i need to clarify

something. >> 48 points, golden state with the difference in the first two games you said that's not commanding. the only leads that are commanding is duke. they always write in about you. golden state. and they won by 48 points. >> they've been dominate. that's a commanding lead. >> would you say the penguins have a commanding lead now? >> honestly, i don't follow hockey. i don't know where it is. >> my question is, were you saying a minute ago that the playboy mansion say teardown? >> oh, yeah, yes. >> the bones are good. but in the back, there's a smelly zoo. >> an old grotto. >> pool has like stereo -- the 32-year-old guy is going to build one big -- eventually.

you know, hef -- >> if the playboy mansion wants to tear down -- >> no, listen. the like stereo equipment out in the pool where they have the parties is like the receiver with a turntable. >> the internet killed the radio -- the internet killed the magazine porn industry. >> did i see what? >> did you sell him that stereo? >> no, i was never say stereo -- did you? >> no. >> i sold him the boots. >> did you ever have -- >> i think joe namath did. he was the dingo boot guy. the dingo ate your baby. >> thank you. >> and later in the news -- you

know -- >> pfizer shares currently -- >> valeant shares that's crossing the tape as we speak. valeant reporting delayed first quarter results. adjusted eps of 1.27. falling 10 cents short of consens consensus. valeant now cutting its full year earnings and revenue guidance. the company's new ceo joseph papa saying the company has made progress towards stabilizing the organization over the last few months. he'll get a little bit of a honeymoon but not for long. in the 8:00 hour, bethany of "vanity fair" is here. and certain board members talking about a key management position for him then. among other, a delicious read

between now and then to read it, you should. >> only a co-journalist could say it was a deliciously -- >> yeah. >> a co-journalist. >> yeah, you are satiated in a hunger way. >> it's a well done piece. she spent a lot of time. >> it's tasty and delicious. >> she's going to be in here. >> it's a long piece. i want to give people time to watch us and read it i thought i'd mention it. it's a segue. >> you do that with co-journalists, you do that a lot. >> you know what's delicious? national doughnut day? that was last week. that's delicious. that was friday. >> yeah, wow. >> and a stupid article in -- an article in a dine magazine. first of all, it's not a dime magazine. >> it's a great magazine. let's get a check of markets

at the moment, the futures are indicated higher even after the s&p closed at its highest level of the year yesterday. the s&p futures up another six points. dow futures up by 65 points. nasdaq futures up by 20. if we take a look at oil prices, oil up by 2.2% yesterday. biggest gain in the last couple weeks. as you can see, it's still trading around 99.96. yesterday was the highest since july of last year. we're right within striking distance today, 49.66. gold prices were up slightly yesterday. you can see this morning that they are -- i don't know where they are. ten-year note. 1.7535%. gold is down by $3.60. still trading by 1,243.80. >> the s&p is now at its highest

level of year. here to see if the stock market can continue to get higher, steven whiting, global chief investment strategist at citibank. >> so, i said earlier, if you can't get, like, you did economic growth -- >> yes. >> -- you fall back on the fed and what they've done. 1, 2, 3. >> central banks outside of the united states looking the fed looking -- >> that's good enough. >> for a while. this doesn't create economic growth in the long run but the idea that central banks have no influence on financial markets that's a different story. when you have 30% of the world's bond markets. you talked about apple at 4%. investors paying more in chance than return of principal and

interest payments for 30% of the world's investment-grade sovereign bonds. when you've had a 8% year to date. and what's happening with petroleum, you start to say why are we trading lower in equities, dividend deals? are they down? no. >> so, we've waited for years, people said baton is going to be handed from staying easy to the underlying economy. the animal spirits will conjure up. >> chances are that time has actually passed. there can be things. economists don't do a very good job of predicting when we have a burst of technological change. >> we may have skipped the big booming recovery. we may be heading to another

recession? >> before the decade is out, it's very likely we'll have a recession recovery pattern. the evidence has suggested that we can extend this longer, though. that we're not going to have a faster recovery than this. most of the news suggests that we'll endorse. the issue particularly for the united states is easy money abroad making it very difficult. there's no cost of capital for the american firms if you're looking at the u.s. stock market. the most important commodity in the world, petroleum has had a deep recession. it's the out of sync industry compared to everything else. we've had so many industries that have climbed. petroleum has had the deepest downturn. that's positioned for some gains. the rest of the piece looks like we're going to continue to limp along with very moderate growth. >> all right. you know, it is kind of a new

paradigm, where you no longer necessarily looking for four or five. you know, it's not the economy, it's not necessarily earnings that appear like this. you know, you've got all of that free money with assets marked up. we'll take it. >> yeah, it points to, you know, very moderate long-run returns. obviously, that's going to get interrupted by recession that always seem to come and will. it's pointing to relatively high valuations in moderate returns. some you look at the bond prospect markets -- >> stock at 4% for 30 years. >> calling for a negative? >> think of ways of getting 5% for the year. ten years, and 12 years, twice the yield, right. steven, thank you.

coming up, disrupters 2016. companies changing the look of business and the way we live. we're revealing the top five first on cnbc next. james patterson start a reading revolution. he's got big plans for small books. as we head to the break check out this date in history.

trolling for a gig with braindrone? can't blame you. it's a drone you control with your brain, which controls your thumbs, which control this joystick. no, i'm actually over at the ge booth. we're creating the operating system for industry. it's called predix. it's gonna change the way the world works. ok, i'm telling my brain to tell the drone to get you a copy of my resume. umm, maybe keep your hands on the controller. look out!! ohhhhhhhhhh... you know what, i'm just gonna email it to you. yeah that's probably safer. ok, cool.

♪ [ playing the star-spangled banner ] i heard that. it was metalica playing the national anthem last night before game four of the stanley cup finals. didn't really change the outcome, even though the guys were wearing san jose sharks jerseys. james hepfield and they got the game going. pittsburgh won, the series in favor of the penguins 3-1. 2016 cnbc disrupter/50 list

released just moments ago. a ranked list of the world's most ambitious and innovative companies. julia, good morning. >> good morning, andrew. in the fourth year of lists, the desire disruptive, has only grown for 700 companies feeting for just 50 spots. the most competitive process yet. our team at cnbc read ever single submission and scored and researched each from a trio of new data partners all to come up with a definitive list of the world's most disruptive companies. top five. number five, 23andme. the genetics company survived a near death collision with the fda. next up, drug development. >> we're collecting over 2 million data points every single

week. and with all of that information, we're able to start to understand the genetic basis of disease. >> number four, palantir. the secret of startups helps rate from financial services to law enforcement. makes sense, big data can solve the world's biggest problems. number three, ezetap bringing the cashless revolution to the world's subscribers and beyond. number two, airbnb. >> when you travlel, you should not go there, you should live there. >> the company has upended the hotel industry. with new user generated guide books, airbnb is going after the entire travel experience. and number one, uber, all that is loved and hated about the on-demand economy, uber continues to push with new services with food delivery and

it's even looking to disrupt its own business model with driverless cars. >> the question with uber is do we resist the future, or do we find a way to become a part of it. >> overall, the companies have a combined valuation of $242 billion. 31 of the 50 are unicorns. even those are worn $10 billion or more. andrew. >> thank you, julia. we're going to have a lot more of disrupters ahead on "squawk box" coming up at 7:40 a.m. number 37 on the list, the founder of tissue coming up on the show. the playboy mansion may have a new owner but another mansion on the east coast is grabbing headlines for getting torn down. that's next. plus, the chairman of the house services committee jeb

hensarling tells us how he's planning on helping. now a list of today's winners and losers. ♪

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lookinging pretty good this morning. up about 60 points after a meltup that we saw yesterday in the average after falling off slowly up 10, 20, this time in the morning. slowly higher and higher as the day went on. now indicated up almost 60 on the dow jones yield strong. sometimes that's how it works. happens here and strong there. no one really checks to see why. rates are going to stay low for t the foreseeable future. steve said it's dead. >> yeah, directly. >> he probably does know. >> he may know -- he may know and some of the other people on the fed might not even know. that's how clued in he is. that's how tight he is. right now it's time for the "executive edge." people are spending less time on social media apps. that's according to a new global

study. the company impaired data from android users daily time on various social platforms facebook saw the biggest drop over the year with usage down more than 20%. twitter was the second biggest followed by snapchat. a mansion replacement. steve cohen is tearing down his east hampton mansion to build a new one. the mega mansion bought for $22 million. going to display a 3600 square foot second floor. and a poolhouse. >> no one is going to live in that old thing. >> that shack? >> yeah. they wonder why people hate hedge fund guys. hey, it's your money.

what you want moon is going to live in that shack. that dude needs a much nicer place. obviously. that's what i would have done. >> just saying. when we come back, t best-selling author james patterson is paving a lighter avenue for readers hoping to encourage more readers worldwide. right now a check of what's happening on the european markets. & in a world held back by compromise, businesses need the agility to do one thing & another. only at&t has the network, people, and partners to help companies be... local & global. open & secure.

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welcome back. it's time for the "sidewaquawk planner." revived labor costs coming out at 8:30. primaries in six states including california and new jersey we'll see what happens. that's today's "squawk planner." one-third of american adults said they didn't even pick up a

book last year. that's according to a recent survey. best-selling author james patterson is hoping to change that launching what's called book shops. it's a line of items that can be read in a single sitting. joining us is james patterson who holds the guinness world records for the most best-sellers. james, welcome. >> thank you. i actually want to be on the disrupt list. this is huge. . the last big integration was the paper book. and when people read this -- >> how many pages? >> all under 150, 160 at the most. >> people pick it up and read it in paper book like this form or a kindle or -- >> both. it will be available. i think where you buy books or online. >> is it your thought that people don't have enough time to read and that's why they can't

get through a 350-page book? >> that's a piece. this is a complement to what's out there. hopefully, it's all about ha habits, successes. uber, people in need, 55 million in new york city, the cabs, whatever. there's a need for this. the idea that you can read one of these like on the train in and on the way back and you've read it, it's a sense of accomplishment. it's cool stories. my wife say big reader. >> yeah. >> and initially, it was a little skepticism. now, she's addicted. just give me another one. give me another one. >> it's kind of like a novella? a short story? >> no it's like a novella. nobody has dealt with a novella. it's not as much a literary thing as stories. it's stories. >> it's shorter stories from the turn of 20th century?

>> obviously, things have happened. serialization, like people can read 100 pages or whatever. >> the full story, i think about collection or short stories? >> no, no. >> they're great. there are great short stories of the 20th century. but it's just a slice of something. >> here's a love story. remember eric siegel -- boom. it worked. >> pulp fiction. >> do we need to worry isn't this feeding into our sense of short-term our add society? is that what this is all about? >> well, no, look, it's there. we can't -- nobody is going to solve that. all you can do i think, is go with it and make it work. and i think it's important. >> for people with an 800-page book -- >> no, to creative standpoint, the amount of work that goes into this, relative to adding 200 more pages to it and

probably $20 more to the cover price -- >> well, that's the other thing about these, they're under five dollars. >> they're under five dollars. but the incremental amount of work, talk to us about it. >> here's a bizarre thing. there was a news guy in my office. i pulled out eight drawers. one year ago, i have 117 of these written. they're almost finished. >> of these. >> yeah, boom, alex cross. this is the woman's murder club. individual ones. 113 minutes. it's not realtime 113 minutes, it's 113 minutes -- >> are these all your ideas that weren't quite ready for full-size novels? >> i don't think they weren't ready. sometimes, some of these just work better. honestly, a lot of my books you know, alex cross is a very good one, they move very quickly. a lot of times there's two or three stories in these things. >> are there any you thought i'm

start with a short version and you said, i want to build this out? >> no. what has happened. i love this character like in the nypd. >> how long will it take you to get one of these 117 ideas -- how did you get the idea, you outline it, work with a writer? >> yeah. i wrote over 2,000 pages to outline. in my outlines are two or three or four drafts. look, from my point, i love -- i love -- i don't work for a living. i play for a living. >> you do an outline in day, two days, a week? >> yeah, i'd say a week. two or three. i could do six in a month or so. you know. in the beginning it was just very liberating with me. i was kind of trapped out of alex cross. there wasn't any room. now, all of a sudden, i've got more contents than marvel. i just love being able to tell the stories. >> i wonder what you think about

the state of americans. the idea that 27% -- >> oh, we're getting who heavy here. >> no, no -- >> look, for adults, we have to be able to dig a little deeper. when somebody says we're going to move 11 million people, you got to ask the next question, well, how are you going to do that? are you going to walk them across the rio grande? you know that kind of thinking. take it farther. free college, how is that going to work. literally, you going to call up the governor of california, it's free now? you know, i mean, not knocking the idea per se, how does that work. >> serious with netflix, binge-watching. as just tough. you can be a vegetable on the couch. >> well, there's worse, people that sit there doing this all day long. >> yeah, both of those are headwinds. we may be seeing the slow steady decline of book readership that

never comes back. >> and televisions and newspapers and magazines. it's elevating into itself. >> and all of your books get turned into netflix series. >> i read trump versus clinton which comes out in their own words. it will be in their own words. various subjects, immigration, et cetera, et cetera. for $28, i'm not sure i want that. but for $4.99, i want it. it's cool. they both say outrageous things. and it's just interesting to go back and forth. a lot of possibilities here. jesus worships the devil, in their own words. >> yeah. >> who's the devil? >> depends where you're sitting right there. he's in the middle. >> ooh, okay. >> purgatory.

>> you love it here. >> i do. >> thank you, james. >> fun seeing. >> you good to see you. coming whup when we return, scrapping and fixing what's on the table. chairman jeb hensarling is going to tell us. and ron baron comes up. on "squawk box" returns in just a moment. ♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪

welcome back to "squawk box" this morning, republicans counting on a victory in november's presidential election. and with it they hope to bring significant changes to financial regulations specifically, dodd-frank. in a speech earlier this morning, chairman of services jeb hensarling will talk about how to fix what he says a broken system that is one size fits all. jeb hensarling joins us with more on what you're saying. what are you saying? >> well in a phrase, we need economic growth for all in a bank that allows for none. we are unveiling a new frame because they had said dodd-frank would not work. 2% growth, a nonexistent jobs

report. wages are stig pant thats. they want to be well-capitalized, they can be less regulated. we believe we need a banking system with a federal safety net that has a whole lot more capital and a whole lot less federal control. we will have an accountability section for both washington and wall street. we will make sure that we quit losing article 1 constitutional power from congress to the unelected, unaccountable bureaucrats which is causing there to be political risk having to be calculated in the u.s. >> how do you sell to the public, though, the idea that there should effectively be on certain banks -- it's hard to describe the capital issue to a certain part of the public, effectively less regulation on the banks? >> it's easy. either you are going to have

private investor capital taking up investor money. we replace bailouts with bankruptcy. there is a special chapter in the bankruptcy code that will be devoted to large global integrated financial institutions. >> some say it's already fixed that problem. >> proponents of dodd-frank would be wrong. then why are the big banks bigger and the small banks fewer? we've had six years to observe in the marketplace what's happening in dodd-frank. what we see is it has not worked. the economy suffers. >> a big bank fails today. what would happen? >> if it happened today it would get bailed out and ultimately taxpayer funds can be used. >> so when president obama and barney frank and everybody else said there would be no more bailouts as a function of that bill, that's not true? >> the bill will say, under the

orderly liquidation authority the fdic can borrow up to 90% of the assets of the bank. look down the street here, the trillions of dollars that could ultimately put in peril. these are the same people who told us the national flood insurance program would never be a bailout. it's under water. pun intended. the pbgc, need i talk about medicare and social security. washington always tells you everything is fine but it's not fine. economic growth is suffering. we have got to get the economy moving again. one of the largest impediments to economic growth in america today is dodd-frank. we need more capital and less federal control or ultimately we're going to wake up and our banks will be turned into the functional equivalent of utilities for the political allocation of capital. we have got to avoid that if we are going to have a robust economy that lifts people from poverty and gives the middle class hope. >> the thing that -- the push-back on this plan is, again, though, the regulatory

piece, this idea that effectively there is lesser -- what happens to the consumer protection bureau, for example? >> what we do is, number one, we give them a dual mission. part of consumer protection is protecting the economic choices in vibrant competitive markets. we're losing those. that's one of the reasons free checks has been cut in half. we have fewer credit cards. they cost more. certain auto loans are costing $500 more. only washington would call that consumer protection. so we need to make sure they enforce the rules not just make up the rules. we increase penalties under our bill for bad actors on wall street and in the financial sector. that's a critical part to make sure we have economic growth. >> have you discussed this with donald trump? >> i have not. i hope to soon. >> do you wake up in the morning and still say you are an optimist? >> you have to be in this job.

there are lots of reasons to crawl into the fetal position and weep. >> say hillary will be the nominee. bernie sanders will have a lot of say in the plank. and if hillary were to be elected and put elizabeth warren in a position of power or influence, what are we going to look like for the next four years? the economy. >> now you're starting to depress me. >> that's what i'm talking about. how do you wake up every morning? you have rose-colored glasses on? when does the country go past the point of no punish. >> return. >> the senate, keeping the senate in republican hands is a challenge but doable. not unlike many republicans i have certainly had my disagreements with donald trump, but at least one thing is i know he is working on a very solid tax plan and he also realizes that dodd-frank has hurt working americans and that it's broken its promises. he is probably going to need a piece of legislation. i hope that we can provide him

with that piece of legislation. >> it will be a relief for you when you the president leaves office, i know that just from having you on so many times. is there any way it could be worse if it's hillary or donald trump? >> if it's hillary, frankly, it's more of the same. i do not believe hillary clinton will be the third administration of bill clinton. it will be the third administration of barack obama. if you care about freedom and economic growth, yes, that is absolutely an anathema. >> do you want to weigh in on the debate about the racism issue? do you believe his comments were racist. >> i haven't seen his comments. it's not something i agree with. listen, i am trying to raise my children in an environment where skin color is as irrelevant as paint color. unfortunately, there are people on both sides of the political spectrum who seem to want to divide us into gender, divide us

into race and ethnicity. no, i do not agree with what donald trump said. it's not the first time and probably won't be the last time. i pretty well disagree with everything hillary clinton says. >> we'll leave the conversation there. thank you. appreciate it. when we come back, a "squawk box" exclusive. ron barron joins us. stick around. "squawk box" will be right back. big things, and spur of the moment things.

highs and within 1% of record levels. are we to have a summer surge? we'll ask ron barron. his picks for the second half

and beyond. cnbc taking the wraps off our 2016 disrupters list. the next generation of entrepreneurs shaking up the business world. bioengineered blood vessels. while there may not be a shortage of ding-dongs around here there may be at your local supermarket. welcome back to "squawk box," here on cnbc, first in business worldwide. i'm joe kernen along with andrew ross sorkin and rebecca quick. futures at this hour are indicated higher, again. and we're only 1% away fwr the -- 1.2% away from the

inter-day high on the s&p 500. that's the highest close for 2016. we've gotten it all back after that scary february when -- what was it? oil prices -- i don't know, the dollar was too strong. what else was going on? >> we were worried about -- we're still worried about brexit and we're still worried -- greece we don't even talk about anymore. >> no. i guess we still worry about terrorism. there is the -- the energy group, which -- that was under 30, remember? it might be supplied, when you're under $30, you think there must be something about global demand. >> yesterday, the highest close in a year. >> $49.99. fascinating stock news this morning. valeant shares are under pressure. when i say pressure, a lot of pressure after the company reported delayed first-quarter results. they were not good. adjust the earnings falling 10 cents short of consensus.

valeant cutting full year earnings and revenue guidance. saying they've made progress towards stabilizing the organization but the market not necessarily believing it. look at that. the stock down in the pre-market almost 12%. >> 90%, andrew. look at that. it's hard to see on the y axis. it's at 25. and that's 2.50. that's like a 90% loss of market company. >> heck of a story. >> which is a i mazing. >> if you're bill ackman -- >> it's amazing that a company would be worth ten cents or a dollar within a 12-month period. i don't know how the prospects for this company are that different than ten months ago. >> ron baron, you hope any stocks you own, that you think are worth one number and then

are only worth 10% of that number? we'll talk about that. if you want to hit home runs, it seems like these are around. >> we try to buy them when they're selling for 10 cents but they're really worth a dollar. verizon reporting plans to submit a second-round bid of around $3 billion for yahoo's core internet businesses. the private equity firm tpg was also expected to smubmit a bid. a little bit of other tech news this mornings. apple selling a 30-year u.s. dollar bond. in taiwan at a yield of 4.15%. this according to sources. that yield is lower than other recent bond issues in the taiwanese market by multinationals like intel and anheuser busch. looking to raise $1 billion in

its first issue of debt in taiwan. you are not taking 30. you don't want apple money for 30 years. >> i would buy pfizer common stock with a 3.5% yield so much faster. i could sell it next week if i wanted to. you can sell the bonds too. but you have credit risk and interest rate risk. 30 years? i don't know. i just saw -- this came out from mark grant. developed world bank yields have now plunged to record lows. you have got a third of all sovereign is negative now, which -- we got to ask ron about that as well. that's just a messed up world. i know that stocks are going to do what they're going to do based on the outlook. but it's just -- nothing you have seen in your lifetime, ron. we'll get to you in a second. let me do this first. shares of sarepta soaring. fda asking for more information on the experimental treatment

for the duchenne form of muscular dystrophy. they delayed a decision on the drug after an advisory panel said they couldn't prove efficacy. there is anecdotal evidence in studies where one kid in the family is getting the drug and one is getting a placebo. one is still walking and the other one can't walk. turning to legendary buy-and-hold investor ron baron. his top 15 stocks generated a total return of more than $8.5 billion just in the last 24 years. ron barron is the chairman and ceo of barron capital and joins us with his outlook and strategy. it's great to see you. thank you for coming in. >> great to see you. congratulations. >> thank you very much. >> i think about you as an optimist.

when i put it in perspective i think about you as a realist. what you are saying makes sense. you have proven it. it holds out over time. every time you come in, you give us a pretty optimistic view of what's happening. what is your view right now? >> i am a very optimistic person. i have had a dream my whole life. i was watching the other night robert kraft, who is a friend of mine, gave a commencement address at toshiba university. he was talking about how he was sitting in the third or fourth row of a patriots' game and they were about to move the team to st. louis. he said i would like to buy this team. they could do so much better if we owned the team. and he went out and he said, gee, the most i can pay for this is $110 million. then he went out and he goes to st. louis, to the busch family and said i would like to buy the team and keep it in boston. they said, you can pay it for

$175 million instead of $110 million he wanted to pay. he said, oh, my god, we can't afford that. he gets his vision and he says, okay, we'll do it. he buys the team for $175 million. he says somehow we'll figure out how to make it work. the next day it's reported that he's going to keep the team in boston. when he keeps the team in boston people stand in line for hours to buy season tickets so he can afford to pay for it. now it's worth billions. so, for me, i am from asbury park, new jersey, when i was a kid, 14, my dad is an engineer for the army. we come to new york for the first time on a bus with my friends. 1 15 years old. we go to madison square garden to watch the everly brothers. we go to green itwich village a go home. i tell him on the bus on the way home. someday i'm going to live in that city. then i meet my wife and we're

having breakfast or lunch and working on the request for the general motors building. i interviewed for a job twice. i didn't get the job. i wasn't qualified for them. i said to her in 1976. i said someday i'll have an office in that building and someday i'll work with my two sons. she said, two sons? we're not even married. so everything -- it's about a dream. if you have this idea in this country, it's an unbelievable place. and so talking about people who talk about making it great again. this is a great place. even for donald trump. it's a great place. it's because of the way our system is set up. >> is your point, though, that things don't look that great in the market right now, it doesn't look like there are a lot of places but if you have vision, patience and the right attitude, you can make money? what do you see for the view of

the stock market? >> my view is everyone is afraid of because of what happened in 2008-2009. so you remember that clearly. then we have a flash crash in 2010 and a flash crash the first -- so people are afraid to invest. that's why stocks are cheap. >> even though we're sitting at 1.5% of the s&p all-time high? >> absolutely. i tie the stock market and the economy together. i think they grow 6%, 7% a year as they have for my whole life since 1960. of course, i was born before 1960. but that's the way the economy and stock market grow. 2% or 3% real. m muhammad ali died. he said i got hit 29,000 times and i was in 61 fights and made $65 million. floyd meriwether, last year or the year before, one fight. $32 million.

babe ruth, $80 million. 1927. >> inflation. >> 3% or 4% a year. >> people will say this time is different, inflation is not here and all the central banks around the globe are conspiring to make too much easy money out there. we haven't seen inflation like that. you think we will return to the normal? that this is not the new normal. >> thousands of years every society has defaulted on their obligations with their debt. we have too much debt in our count. the way we're a getting out of debt is by making it worth less relative -- it's a mortgage on our economy. we are making it worth less relative to the size of the economy by depreciating the currency. to think that we're not going to be successful -- $4 trillion balance sheet in the federal reserve. to think we're not going to forgive student loans. cash for clunkers a couple of years ago. we did that. greece and rome. in rome they were conquering for hundreds of years. all the land around them.

they were going to collection taxes. they paid the soldiers in precious metal coins. they didn't have enough coins. they reduced the metal in the coins and reduced the size of the coins. we are the same way. buffett says that 1965, when he starts his business 50 years ago, he says that his -- you know, what cost then -- he said 13 cents, 12 cents, now costs a dollar. so it's eight times. so eight times is three doubles. 2, 4, 8. three doubles in 50 years means you lose half the value of your money every 17 years. 3.5%, 4% a year. to 3% or 4% a year has been historically the range of inflation. 2% or 3% a year has been the real growth. we have had the 6% or 7% growth in the economy. go back to 1960. the gdp was $520 billion, and the stock market was 600. 520 billion.

it's now 19 trillion this year, up from 18 trillion last year. that's 5%. this year from last year the economy has grown 5%. next year, over 20 trillion. so it's over 5%. no one tells you that. they tell you it's 2. they tell you inflation is nothing. but inflation is -- so we have a big picture. big picture is that the economy grows 5% or 6% a year. or 7. now we're going to grow a little bit slower because we have to reduce some of the debt. number one, you have the growth in the smoimetock market and ec go together. we try to buy companies that are doubling in price and value every five years instead of doubling in every ten years. so the stock market, it gets the tail wind from the economy, and the economy doubles in size every ten years. and what we try to do is double in value every five years. that's picture number one. picture number two is about inflation. so i was reading a comment by munger, who was talking about

how the other nations are paying -- charging us a lot of money for their energy to bring it into our country. we're paying them in dollars, or we're paying the chinese goods for -- with dollars. and he says, i want to leave all the energy in our country in the ground, and let's buy their stuff with our dollars. they're not worth anything anyway. so the idea is dollars are not a stored value. they're just something to transact with. store value are businesses, real estate. art. >> those are the things that really add up. we'll talk about some of the stocks that ron likes best right now. we have him for the next, oh, 25 minutes or so. more of the stocks in a moment. we'll have more from ron after the break. we'll find out where he is putting his money to work. right now. later, company disrupting the medical field by creating off the shelf tissue replacement. "squawk box" returns in a

moment. vo: at&t introduces a buy one get one offer that sounds really good. and looks good. thanks nice job on the typesetting, guys. this bogo offer is making me feel all tingly inside. is that normal? yes. anyway, come in and take advantage of this offer. huh? (yelling) it's a great offer! what? buy one get one free! yeah, this bus goes downtown. let's just go back to the graphics. right now at at&t, buy a samsung galaxy s7 and get one free.

♪ no, you're not ♪ yogonna watch it! ♪tch it! ♪ ♪ we can't let you download on the goooooo! ♪ ♪ you'll just have to miss it! ♪ yeah, you'll just have to miss it! ♪ ♪ we can't let you download... uh, no thanks. i have x1 from xfinity so... don't fall for directv. xfinity lets you download your shows from anywhere. i used to like that song. we are opening the ron barron playbook this morning. i want to get to some of your biggest holdings. i just want to start first with. i want to get to some of your biggest holdings. i just want to start first with something i have always wanted to ask you. if you could always be right

about story stocks, you can make a lot of money. and i just never know how you're -- whether you know whether you're right or wrong and how you hold a conviction. i will give you two examples. amgen. went from a dollar to a thousand. i watched it happen. the entire way people said it was a story stock and it will never get where it's going. i think of things like i-omega and others. press tech. taser. i think about all these story stocks that people think will go to the moon. how do you know that tesla is a real story and not a story stock? >> joe, i don't rely upon other people's research. i rely upon our research. so our firm has grown -- well, we have had 60 people ten years ago. we now have 143. 146. and 20 people who are analysts

and portfolio managers, now we have 33, will be 36 this summer. we do our own research. >> have you ever gotten sucked into one? >> yes. people have given to us $4 billion to invest for them since 1992. >> your track record is amazing. how do you do it? how do you not get sucked into a valeant? >> i hated the idea of it. i hated the numbers. we're not interested in numbers. >> just this morning -- i just saw it. i didn't look at it. something on twitter said tesla, the ultimate ponzi scheme. i didn't look at it, but there is a whole group of people who think that this -- that tesla is somehow -- that there will be a day of coupme uppens. >> i go there every three or four months and look at the factory and see how much is changing. and talk to them on a regular basis. we have $300 million invested.

it's taken us three years to make the investment. our cost is $208 a share. it takes us a very long time to make an investment. for vail investments. 1977 to 2006. >> you can guarantee me you won't sell the tesla. it will pay off? >> we never know. we make a mistake, we sell. when the opportunities for growth aren't there -- >> you have hit it big on some of the biggest story stocks. apple. what's your adjusted cost on apple? >> i am not an investor in apple. >> netflix. >> under armour. >> we've made ten, 12 times our money. we have recently bought in the past week a million and a half shares when the stock has come down a couple of points because they have lost a customer. and instead of doing 5 billion

in sales, 4 billion 9 this year. nobody will think about this in a few years, about what happened today. i think the company will go from 5 billion to 20 billion in eight or ten years. when they get there, they make a 15% profit margin. it's now three times sales. nike is three times sales. amazon is three times sales. you can know what sales are. you can't know what earnings are. they can make them whatever they want them to be. ultimately they'll make a good profit margin on sales. tesla. i can only have 3 billion invested. if we made $18 billion. on this one investment we can make a lot of profit. >> tesla or under armour? >> tesla. under armour. we'll make four times in the next ten years in under armour. you pick a price and figure out what the company is worth today

and what it's going to be worth. things go the way you expect. and then you buy. so what we buy -- we only make investments so we can make a double in five years, double again in the next five years. >> how do you think about selling? when you look at a company like under armour, tremendous success thus far, you said up ten times already, but now it's going to -- it's -- big numbers. harder to grow. they're doing a great job, but -- >> do you see the guys they have signed up? >> it's amazing. how how do you think about the growth rate? >> here is a company growing 25%, 30% a year. doing 5 billion in sales this year? last year they did $700 million of sales in shoes. athletic shoes. this year they should do about a billion. they have a billion dollars, 20% of their revenues are growing at this rate. phenomenal pace. and they're a small percentage of shoes.

nike does 800 million shoes. our guy does 20 million. our guy, nike gets the top basketball guys. >> amazing thing. >> our guy gets steph curry. our guy gets jordan spieth. tom brady. >> for tesla, and elon musk? say you throw the financial and innovative talent of bmw or mercedes or porsche. you throw them into the electric car market with all that expertise -- >> you're 60 years old. you are now the chairman of general motors. you have these billions and billions invested in plants that make gasoline engines. that's your expertise. i have an office in general motors' building. they make motors. >> you're sure elon musk's raw talent will eclipse. >> stay there. you're mary barra. head of the company.

pinnacle of your career. you go to your board and say, i think we should take $5 billion and invest it in a plant that makes batteries that will obsolete the engines of the cars that we make. a billion dollars for a plant. go to the board and do that. when the engineering is not exactly right, what does elon musk do? he sleeps on the floor of the production line until he gets it right. when the program is not right for the door handles coming in and out, he stays there -- >> you're investing in elon musk. >> this one guy in 14,000 people working there. he is the leader. >> you assume he'll stay one step ahead of the competition. >> the competition is not anywhere. they can't catch him now. he is too far ahead. with the new battery plant. everyone thinks about car companies as a capital intensive business. now we're in the stage of tesla where they're going to get

gigantic returns on capital. it will become a capital like business for -- >> you like netflix too? >> i totally screwed that one up? >> you did? >> yes. i had it at the very beginning. >> we'll come back and talk about this one in a minute. >> i have to finish on tesla. >> we'll do tesla and netflix. while there is no shortage of ding-dongs around here, you might have trouble finding them at the supermarket. check out the price of crude. wti at 50.11. every year, the amount of data your enterprise uses goes up. smart devices are up. cloud is up. analytics is up. seems like everything is up except your budget. introducing comcast business enterprise solutions. with a different kind of network that delivers the bandwidth you need

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. welcome back, everybody. among the stories front and center this morning, valeant shares are under pressure after the embattled company reported delayed first-quarter results. adjusted earnings falling 10 cents shorted of the wall street consensus. valeant is cutting its full-year earnings and revenue guidance as well. the ceo says the company has made progress towards stabilizing the organization

over the last few months. but the stock market not buying into it at least at this point. looks like the shares are down 14%, a decline of $4. 2478 is the last trade. the markets will have economic reports to react to this morning. revised first-quarter productivity and labor costs both out at 8:30 a.m. eastern time. a billion dollar deal to tell you about. zimmer biomed acquires ldr at $37 a share. the deal will expand zimmer's abilities to treat patients suffering from spine disorders. homeland security documents obtained by cnbc revealing a previously unknown syrian refugee smuggling organization bringing immigrants from syria to the u.s.-mexican border. eamon javers joins us with more. pretty amazing. >> that's right, joe. this is a customs and border patrol document obtained by cnbc

revealing the existence of a previously-unknown human smuggling organization that brings syrian refugees from hom to the u.s.-mexican border. according to the document it is called it is called the barra cat organization. the people smuggled from the group say they are syrian christians. it smuggles refugees from hom to mexico. it says it can exploit the entire southern united states border. look at this map. it will show you the elaborate planning and travel logistics that went into getting five syrian men to texas last year. they started in hom, syria and went to istanbul. they jumped on a flight to ethiopia. there the five men had bogus travel plans to mows zambique.

they went to brazil to bowing-tbowingota, colomb colombia. there they meet up with another smuggler who drives nthem from the southern mexican border to the norton borden. and there ne ask for asylum. i've tracked down the five men. facebook pages that appear to be the pages affiliated with the men. it indicates that three are still in the united states. they've applied for asylum. the attorney for one of of the men told me his case is pending in the united states. this indicates to u.s. law enforcement that there is an elaborate planning organization going on here to get these people from syria into the united states. it spans half the world and has people on the ground in four continents, guys. >> thank you. let's get back to our very special guest ron baron, the chairman and ceo of baron

capital. we left off on tesla. you wanted to talk more about that. you also got into netflix and how that actually turned out to be a mistake. >> talk about the mistake first so you can end with what you like. >> so we -- tesla, at the very beginning. he used to tell me. reed hastings. he said, ron, we have a business here that, if we were going to rely upon send discs through the mail, we wouldn't call ourselves discs through the mail not netflix. i wasn't getting the concept. i couldn't understand why other people didn't do it. when the stock had fallen because he raised prices and the stock fell from 150 to 50 or something. he was saying, you have to buy the stock. telling me, you gotta buy the stock! so i invested in the company at $50 or $60 or $70, down two-thirds. i am nervous about investing in the companies when the full

two-thirds -- like valeant. everyone is having all these negative stories. it goes up a bit. i say i don't understand it well enough. i sell it, and then it goes up ten times or icahn buys it at $80. i totally blew that one. stupidest thing. so you make mistakes. you learn from them. you learn at least as much from your mistakes as you do from the big gains you have had. in the case of netflix, the way we approach investments is you're trying to find businesses that have opportunities -- this is about your story idea -- you find businesses that have an opportunity to become much larger than they are right now. anyone can do that. then competitive advantage. you have to figure out what it is about that business that they're doing that other people can't do or won't do or are unable to do. then you try to find these great management teams that you can invest in for the long term and you invest long term. baron growth fund, the average

holding period is 12 years in public holding companies. the average for most is a year and a half. hedge funds. days, weeks, seconds. 12 years. we have a vision about what a business will become. what you do to make sure you have a business instead of a story is that you keep in constant contact. you have your analyst team, and they work together for a longer and longer period of time. you only hire great people, and they get better and better as a team. as they get better as a team they're more proficient. i hope in five or ten years we have better results than we have now because the team is bigger and that much stronger. tesla, we go visit the factory every three or four months. if it didn't p doesn't develop the way i am expecting i'll sell my stock. i'm not engaged to be married. on the other hand, i think there is a good chance i could own the stock for 10, 15, 20 years. i think it could be one of the largest companies in the united

states and the whole world. >> were you surprised when elon musk accelerated the plans as to how many he planned to make. some people -- the cynics would say he did it as a function of trying to raise more money. >> he actually took less money on the last offering than he was offered. so no. i don't buy that. and i don't think he's going to be back to the market for quite a while, if he'll ever be back to the market for equity again. with this business, it's on the verge of becoming capital light. capital efficient. that's not for automobile companies. automobile companies require lots of capital. this guy is on the verge of becoming capital light. it's amazing. they spent $5 billion on this battery factory, to give you an example. they're spending it in partnership with panasonic. they figured out how much production they could get, theoretical maximum production they could get from the

facility. they announced thea couple mont ago, they are going to do three times what they thought. $5 billion. they were supposed to do batteries for 500,000 cars. now a million and a half cars. the factory in california they have that makes cars, they think they'll do significantly more, several-fold, what they did initially in the factory. several-fold. so they're making this factory like the product itself. and so -- let me give you one example of capital light. so they look at -- there are different cars you can get. you can get a car that's mass-produced, mercedes, cadillac, ford. they have a certain kind of paint job. you say it's not great. it's okay. you look at the ones that are exclusive. hand-painted. our guy wants a mass-produced car that has the quality of a hand-painted car. so he builds a paint factory.

when he's doing 50,000 cars he builds a paint factory for $300 million. that factory. when it does 250,000 cars -- remember, he's doing 50,000 cars -- does 250,000 cars he'll save 14 hours of -- three hours a car instead of 17 hours. saving $700 a car. he can make $150 million in savings for a $300 million investment. that's okay. now, to double that capacity he needs to spend $50 million. 50 million. makes him another $150 million a year. so now, throughout his whole plant, throughout his whole operation, he has these opportunities to invest small amounts of capital at very high rates of return. that's what's happening in tesla right now. people realize that. that the opportunities will be enormous. then they can do as much sales in batteries ultimately as they can in cars. he's doing -- 71 million cars a year are sold. and this -- this company is now

doing -- the opportunity. you can see how big it is. next year they'll do $20 billion in sales. this year $8 billion or $9 billion. last year 5 or 6. >> if they don't deliver on time what happens to your confidence? >> people say, well, he'll never be able to produce this many cars this fast. and the parts -- the gears, the suppliers, it takes -- ordinarily a car six years to -- ralph lauren. we invested in him in 1999. i am talking to him one afternoon. i said, what are you doing this weekend? he says, well, i am going to detroit. what are you doing? he says, i'm going to meet cadillac. i have an idea for a cadillac polo car. he comes back on monday or tuesday. i say how did it go? terrible, ron. terrible. i went out there.

they showed me the plant. i gave them my idea for a redesigned polo car. they say, we can't do that. we have our cars planned seven years in advance. he walks him into the back and shows him all these cars. he says, ron, we would have bought one of these cars, but they're not going to make them for seven years. it takes the automobile industry -- they had cars with big fins or chrome on it or a different grill. this were crazy changes they would do all the time just so you wouldn't feel like you were driving an obsolete vehicle. >> i just want to know a couple other names. we talked tesla. you don't still own ralph lauren, though, right? >> no. under armour. i love under armour right now, the opportunity for shoes is really big. i like one that happens to be a company helping to make health care. health care provision with data is going to be -- is going to be a huge business.

this is a company that is getting new customers. when they get new customers, they get a small percentage -- like kindred. a small number of beds that are very -- at a very unattractive price to them. when they show they're getting great returns, the customer -- all of a sudden they get a much better price and they roll it out to the whole system. this is a company that's going to double in size in four or five years and grow monstrously. in the next five years it's a billion. >> genera? >> we don't own it. >> vail resorts? >> love vail. >> why don't you own generec? >> we made a huge amount of money in the company. i know i was trying to persuade you to buy one of the -- >> i did. >> -- generators. it worked. i just felt that some of the acquisitions that were made -- they were getting a little far afield.

but now the stock is i think probably attractive again. but in vail -- vail is something -- '97 to 2006 we bought 15% of the company. so, again, it takes us a long time to make these investments in these businesses. so we are -- everything we do is about long time. took us a long time to buy it. made 50% return in the first seven, eight, nine years. we made five times our money. i think we'll double in four or five years. we thought they could charge $100 a day instead of 80. now they're charging $180. >> we have to thank ron for making us positive. we're usually crazed and he gives us hope. >> thank you. >> we can always invest in snow-making equipment too. coming up, a disrupter in the medical field. humacyte grows off the shelf. they join us after the break to talk about the proprietary

technology. we'll be right back. yet many people still build portfolios with strategies that just track the benchmarks. but investing isn't about achieving average. it's about achieving goals. and invesco believes doing that today requires the art and expertise of high-conviction investing. translation? it's time to bench the benchmarks.

uh, maybe we should call i.t. today, we're seeing new technologies make healthcare more personal with patient-centric, digital innovations; from self-monitoring devices that can interpret personal data and enable targeted care, to cloud platforms that invite providers to collaborate with the patients they serve. that's why over 90% of the top 25 global pharmaceutical companies are turning to cognizant. our domain experts, technologists, digital and data specialists, clinicians and scientists

are transforming the way clinical research sites collaborate with pharmaceutical companies, they join us after the break . this year cnbc's disruptor 50 list out this morning. first representative from the list of the most disruptive

private companies around is number 37, humacyte. develops lab-created tissue for regenerative medicine. laura niklason. bypass surgery. my dad had it. they got the arteries or veins from his legs. one of the hardest things to recover from after the surgery is you had all this work on your lower legs and it's so painful but they use those arteries to graft into the occluded arteries leading to the heart. be nice if you didn't have to do that. >> thanks so much for having us on. i appreciate it. humacyte's technology i think will be transformative. because we have the ability to engineer human tissues in the lab which can then be implanted into any patient to treat disease. >> and you take it -- i assume you take the cells from the patient that's going to get -- >> we don't. >> why is there not an antibody

response? >> so the way this technology works is we have a human cell bank. in this case to make blood vessels we have a human vascular cell bank. we seed the cells into a bioreactor. i have an example of one here. we give the cells nutrients and mechanical signals to coax them to grow into a new blood vessel. >> you have the infrastructure there. biodegradable skable scaffold. you haven't actually done the engineering for stem cells to grow arteries but you have a scaffold and it builds it right on the scaffold. >> right. >> why is there not a rejection of this? >> in the last step, we wash the donor cells away, the cell bank cells. we wash them away. so the tissue that goes into the patient is actually just the proteins that the cells made. like collagen. interestingly your collagen and my collagen are the same. >> exactly. so there is no -- there is no actual cells that are specific

to an individual that have all the antigens -- >> right. >> hold it right there. we have a camera. it's amazing. it's literally a bag. >> it is. >> is this the collagen? >> it is. and about 60 other proteins but mostly collagen. >> how fragile it? >> it's not fragile. it's -- >> it's a little cold. >> it's a little cool. >> he broke some glasses the other day. >> i had a guy who came with his vr glasses. i tried to put them on and broke them. >> that's because your head has gotten so big. >> how much is this worth? >> how much is it worth? >> yes. >> it's worth an infinite amount of money to me. ultimately it may sell for several thousand dollars once we gain approval. >> the arteries you are talking about don't have any -- nothing is going on at the cellular

level with things going in and out of the artery? you can put solid things in there like a tube? why not use a tube? why do you need collagen. >> the col ajen and the other proteins in there convince the cells in the patient's body to migrate in and convert that into a living tissue. so after six or nine months, it's not really the implant anymore. >> so it does become a functional artery. >> it absolutely becomes a functional artery. >> i just squeezed a drop out. >> why did you know that would happen? >> we didn't know it would happen. we had to do the experiments in animals to figure it out. we did a lot of pre-clinical studies for years. >> so you put it in a person. >> mm-hmm. >> during bypass surgery. >> mm-hmm. >> are they at risk for the first six months when it's not populated with what it needs? how do you take care of the transition period? >> that's a good question. and the key really, to making

this successful, is the fact that this tissue, once we grow it, is actually very mechanically strong. so your blood pressure is like probably 120 millimeters of mercury. these things rupture over 2,000 millimeters of mercury. they're like 20 times stronger than your blood pressure. >> you mentioned fda approval. what do you do to do to get the fda approval. >> we have completed phase 1-2 trials and published results and we've just completed a phase 3 trial that will compare the engineered tissue to an otherwise standard of care, which would be basically a teflon, plastic tube. we'll do that study for the next few years. if the results come out as hoped we hope to gain approval. >> can you make me an aorta? >> we could do that. >> make me something -- if i have problems -- diabetics get problems in their legs.

can you make new ones for there? >> we have already implanted 20 patients who have problems with arteries in their legs. we haven't published those results yet but it's ongoing. that's one of the exciting things about this technology. >> how small can you make them? >> a millimeter? >> really? >> yeah. because there is a lot of other tubes in the body -- we see this as going beyond blood vessels and bypass. potentially we could replace windpipe. esophagus, other parts of the intestine. there are a lot of places we could go with this. >> it starts with collagen? >> collagen plus the other goodies that are in there. >> the growth coenzymes and growth factors. >> sure. >> were you an m.d. or ph.d. or both? >> yes. >> yes to both. >> i am an m.d., anesthesiologist. intensive care unit physician. >> that's where you came up with the idea, right?

>> i kwcare for the very ill. >> you could be a multi-billion dollar business woman. >> we'll see. >> what was the initial thought, though? >> the initial thought, actually, what first inspired me to develop this was i was actually in my anesthesia training 20 years ago, and i was taking care of a patient who was getting heart bypass just like joe's dad. and the surgeons really had to look very hard to find suitable vein to do the bypass. >> my dad -- it was so painful. trying to get it to heal. >> it's terrible. >> what they do to your legs to try to put it into your heart. that's all you need when you have other problems. that's great. so interesting. >> thank you. >> thank you very much. in the next hour, another reveal. won't be nearly as cool, probably, from our 2016 -- kidding -- disruptor list. the co-founder and ceo of teespring will join us at 8:40

this morning. i don't know if they're saving the world, but it might be interesting. when we come back, a dessert disaster and a possible fish shortage. those stories after the break. plus, check out the futures. looking higher this morning even after the s&p closed at the high levels. "squawk box" will be right back. actions speak louder. something we'll show you. through small things,

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box." the supermarket aisle might look empty for ding dong fans. they're recalling them because the flour may contain peanut residue not noted on the packaging. if it's not in the aisles. i'm sorry. hillary clinton reaching the magic number of required delegat delegates. we talk about the race for the white house when squawk runs. this just got interesting. so why pause to take a pill? and why stop 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,

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the race for the white house. hillary clinton hits the magic number to children the democratic presidential nomination. but bernie sanders says, not so fast. former obama white house communications director anita dun joins us live. wall street's drug addiction. "vanity fair" open the book on valeant. the players, the problems and how much so much smart money got caught up in the story. meet the ultimate list of private companies ready to change the game. up next, the t-shirt company everyone in silicon valley is talking about as the final hour of "squawk box" begins right now.

welcome back to "squawk box" here on snecnbc first in busine worldwide. we're coming around. i'm joe kernen along with rebecca quick and andrew ross sorkin. less than 90 minutes away from the opening bell on wall street. the futures right now up about 55 points this morning after a pretty good session yesterday that got progressively better as the day went on. europe was higher and now we're higher again. we start, then they follow and then we follow them. there it is. everybody is up over a point except for the ftse which was stronger on a relative basis than germany and france, i think. andrew. making headlines this morning, oil prices are rising. brent hovering near a 7-month high. wti is at its best level in a

year. nigerian oil infrastructure attacks and expectations for declining oil inventories. wti at 5025. valeant is getting crushed again after the company posted weaker than expected quarterly results this morning and cut the outlook for the full year. you're looking at shares now down about 17.5% in the pre-market. we'll talk more about valeant with betny mcclain of "vanity fair" in a couple minutes. shares of biogen under pressure. the drug missing the primary endpoint on a trial on the treatment of multiple sclerosis. in political news. today marks the final push of the primary season. voting in six states including california and new jersey. ahead of this hillary clinton has hit the so-called magic number. john harwood joins us on the set. john, this became news last night when i guess she garnered more superdelegates.

>> the a.p. did a survey of superdelegates. they're continuing to monitor their preferences. enough said they were for hillary clinton to put her over the 2,383 number. you can see from the states that are voting today, the two giant ones here are new hampshire -- excuse me. new jersey and california. that's where the bulk of the delegates are today. hillary clinton has already got enough to win the nomination. the only question now is when bernie sanders decides to get out of the race and concede. nancy pelosi tried to push that along this morning by embracing hillary clinton and saying she will vote for hillary clinton and thanking bernie sanders for invigorating the democratic primary. this means the trump-clinton general election is now on. you can expect to see more exchanges about this one about donald trump's comments about judge curiel in the trump university case. >> mexican or not mexican. i want him to be -- all i want

him to do is give me a fair shake. >> i don't know what's in his heart but i know what he's saying. with respect to the judge, that's a racist attack. >> we have a new nbc/survey monkey poll showing hillary clinton out with a four-point lead over trump. interestingly, when you include third-party options trump actually goes ahead. we have to see what happens with the impact of the green party as well as the libertarian party. >> you know what's weird to me still? nancy pelosi, former de facto, you know, head -- when she was majority leader -- from a de facto head. it took till now to make a choice between a socialist and hillary clinton? i just -- that's got a weird -- the whole party is afraid of this base, just like the republican party is afraid of donald trump's base. the whole party is afraid of alienating these whackos that think sockingiialism is the way

go. mainstream democrats still have not stood up and said i believe socialism is not a fair alternative to what we have. they still have not rejected that. it's crazy, john. >> leadership of every party is scared of their base, and that is true. you are right about that. you also have democratic leaders like republican leaders wanting to step back and say, we'll wait until this is settled. we'll let the primary voters settle it. >> we always knew hillary clinton was going to be -- i would want to be early too. i would want to be on it early, and i would also just -- i would want my name down as not saying that socialism is a viable alternative. >> understood. you did have both obama and pelosi signaling, without coming out in favor of hillary clinton. >> politics is crazy. it is. >> john, stay with us. we'll bring in another voice right now. joining us, democratic strategist anita dunn.

former white house communications director for president obama. he is -- she is also currently managing director at skd knickerbocker. thank you for being here this morning. >> thank you for having me this morning. exciting day. >> you heard this -- this situation as john laid out and as joe commented on it. do you think that today is the day, or next week is the day, when bernie sanders admits defeat and says he doesn't have the numbers to get there? >> well, i think senator sanders is going to assess where he is after the contests tonight. as you know, he has put an enormous -- some would say huge importance on california and on doing very well in california and winning california. and we will see what happens tonight. but, you know, this race is entering its next phase where secretary clinton has the delegates to be the nominee of the democratic party. and senator sanders is going to look at the delegates that he has amassed and figure out how

he can best leverage perhaps the platform, party rules, and other things that will advance why he got in the race to begin with. >> if he wins big in california, is it your guess that he'll stay until the convention and make it a contested convention as he said this weekend? >> people can stay through the convention in different ways. in 1984 gary harted and jesse jackson both stayed in the race until the convention. neither conceded to walter mondale. clearly they were not as active candidates. they were not attacking mondale. they were trying to do things at the convention that required them to stay in as candidates. senator sanders has run a great campaign. he has spoken to millions of democratic voters in this country. it is going to be his decision what he does next. but he has said consistently that his number one goal is to make sure donald trump does not become president.

>> yet yesterday i still heard comments slamming hillary clinton for the clinton foundation and for the perceived -- he didn't even say perceived, but the conflict of interest with having the foundation and having millions of dollars plowed into it. i mean, it -- to hear him still making comments like that as recently as last night, does it give you any pause or concern? >> you know, he is still trying to win some primaries here. it has been a contested race. as primaries always are. but listen, primaries are an argument about a direction of a political party. a general election is the argument about the direction of a nation. secretary clinton has begun her argument against donald trump with the foreign policy speech. that's the direction we're going now. the nation, who should lead it. >> anita, when you think about the various primary contests

that you have experienced and watched, as i have, do you think this is going to be, compared to the norm, more difficult to unite the party than we've seen in past campaigns? or do you think that's not the case? >> i think part of it depends on obviously what senator sanders decides to do. i think that there are some interesting dynamics in this political party right now that will make it -- you know, it could take a little longer than usual because the dynamics have been so defined between two candidates for so long. we haven't had a contested race that really stayed this contested this long for a while. i think in 2008, even though secretary clinton didn't concede until afternoon the election, the last six weeks or so of the primaries really weren't very engaged between the two candidates. i think they were both speaking to their own groups of voters. so it's been a while since we have had a contest go this long, this strongly. and i think that every race is

different. it's going to be a challenge, but secretary clinton is going to start speaking i think very directly to the voters that supported senator sanders. and that is what she needs to do. she needs to talk to those voters in a way that's compelling. >> do you believe there are -- that there are people supporting senator sanders who would really vote for donald trump? >> very few. >> i am curious where you land on it? >> it's interesting. i have people say are there supporters of senator sanders who would support gary johnson, the libertarian candidate. they could not be further apart in what they see as the economic inequality and how to address it. no, i don't think that will happen. i don't think senator sanders' supporters will find themselves comfortable supporting donald trump. >> will they actually vote for hillary clinton, or will they not vote or will they write in "bernie sanders"? i have heard -- this is

anecdotal evidence but i have heard sanders' supporters say all those things. >> eight years ago when hillary clinton gave her concession speech and talked about the 18 million cracks in the glass ceiling for women. if you polled the room that came to hear that speech you would have found very few barack obama voters at that time. by november those people were voting for barack obama. it's a process that takes time. the most fervent supporters of senator sanders will have to go through a process. i think jay carson wrote a great op-ed yesterday in the "new york times" about the process you go through when you've been supporting someone and they lose. the choice here will be between donald trump, hillary clinton, and the direction of the united states. i think senator sanders' supporters were brought into the political process because they care about this. and they'll have to make the choice. i feel confident that the choice they'll end up with will be the right one. >> anita just mentioned president obama. president obama is going to have something to say about the

pulling together of those supporters too. he is over 80% approval rating from sanders' supporters. so he can help and he has sent signals that he is going to begin the process pretty soon. >> have you seen a critique that he's more involved in this campaign than any other president? is that true? >> we haven't seen it yet, but i think he's going to be extremely involved because he thinks it's so important to the preservation of his legacy to be succeeded by a democrat. >> it is. they'll roll back most of what he's done if not. >> yes. >> thank you. anita, thank you for joining us this morning. >> thank you for having me. it's amazing, john. we keep hearing about the president's approval ratings. 51%, 52%, hasn't budged with republicans. but all the former democrats that didn't think he was far enough left have all come -- that he's got a 91 disapproval among republicans. so the move from 44 up to 51 has

been the 7% of democrats that thought he had disappointed them by not -- >> and some independents. >> i think it's more people who thought he wasn't hopey and changy enough. from politics to drugs. coming up, wall street's drug addiction. "vanity fair" opening the book on valeant. find out how so much so-called smart money got caught up. later, a big day here on cnbc unveiling this year's disruptor 50 list. one of the winners, tee spring, joins us live at 8:30. back in a moment.

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welcome back to "squawk box" this morning. among today's biggest stock movers before the markets opened, the embattled drug company posting weaker than expected quarterly results and valeant cutting results for the full year. "vanity fair" magazine out with an in-depth expose of the saga going on. under investigation for rate hikes on drugs. the contributing editor is here to discuss it with us. good morning.

>> good morning. >> this is a very -- you have been working on this piece for months. >> months, yeah. it's a complicated story. >> biggest revelation. i can give you my list. but there are so many in there, for you. >> for me it was the number of smart money investors who got caught up in this thing and the mass delusion that seemed to surround mike pearson. it was almost a cult. that's shocking. >> so you look -- i don't know if you saw the news this morning. and the stock already down. just handicap it for us. is this a company going to zero? is this a real company? what's going on here? >> there is a big battle over the extent to which the price hikes contributed to earnings. i think, when congress released the 800 pages of documents a month or so ago, whenever it was, you dug through them and saw that this business where they had these exorbitant price hikes was a huge percentage of the company's adjusted ebitda.

you say, they have the other great businesses not driven by price hikes, those businesses are not so profitable. >> you famously uncovered enron as a real -- >> that's an overstatement. i get too much credit for that. >> is this a criminal enterprise? >> oh, boy. i think that's being investigated, right? one of the questions is some of the strategies valeant used to drive pricing are illegal, if the government was a payer. i am sure that's one of the things that the government is looking into right now. there are also accounting questions that the sec is looking into in terms of their acquisition accounting. there are so many different prongs of investigations going on. there are patient assistance programs they use which, again, can cross the line into illegal if the government was a payer. given how aggressive some of the specialty pharmas were, it's possible. >> question of potential deef default. if the company cannot sign off

on the quarterly or annual filings -- >> i think the near-term issues are less of an issue than whether the business produces enough profits over the long haul to service the debt. that's the real question. it goes back to how dependent they were on the price hikes. >> the $30 billion debt was because of the acquisitions? >> yes. >> you mentioned the smart money that bought into this. >> yes. >> bill ackman. be an armchair psychologist. what happened? >> people fell in love with mike pearson. it was a cult. a line in my story says anytime you have people referring to a ceo by his first name that's a cult nott an investment. people believed in this guy. it's funny because in some ways he was anti-ceo. he wasn't a smooth and polished pharmaceutical executive. he was gruff, dressed badly and was direct. people bought into the idea that he could deliver results.

>> people would come on and say, we don't invest in research because we find small companies who have gotten drugs to a certain point and then we see they're just about ready to be commercialized and then we buy them and don't need to do the research. that's not what it was. this was buying them, they were already commercialized and raising the prices. >> even if it was true in some cases. the code for that is we're smarter than everybody else. everybody else who is looking to buy proven winners at a low price -- what you're saying is we're smarter than ever other pharmaceutical company out there. >> you address some of the speculation in the piece about the -- you were the first person to report it there is a dwi in 2009. >> forbes first reported it. >> questions about his role as a key man. other questions about if you remember when he went on sick leave. >> yeah. >> what do you think happened? >> from what i have heard he

actually was incredibly sick and actually near death. so i don't -- the question is -- it was pneumonia. the question is were other things a contributing factor. who knows. he came back using a cane, much thinner. something happened. >> we just don't know what caused it to happen, i guess. >> what are we going to be talking about in a year or two? >> that's the interesting question. either we won't be talking about it because it will sort of fizzle out. i don't think it will be back on the grand stage the way it was when the stock was over $200 a share. i don't see that coming. it might fizzle out and not be interesting. it will be limping along and that will be that. or there will be a bankruptcy and more news from the government authorities investigating it and then we'll all be talking about it. >> you can't have known that -- about how big some of the price hikes were? >> the skeptics knew. that's what's the funny thing. >> ackman had to know the

business model involved big price increases. >> everybody knew it did. everybody knew what the company was doing. i think people didn't understand the effect of that on the profits. that was on ongoing wall street w war. it was a wall street war. >> how does this affect bill ackman? >> that's a big question. >> you have watched him for a long time. >> he is in there trying to fix it. you can applaud that he stepped on the board and is in trying to fix it. some businesses are not fixable. >> what about jeff in value-act. >> they were far more the architects of the strategy. ackman didn't take a role until just recently. i think it casts a big question about the role of activist investors on a board. you would like to believe a company that had smart money investors on -- activist

investors on the board would have been run better than this, and it was not. i don't see how that raises huge questions about value-act and all these guys. >> bethany, thank you. if you have not read the piece, go out and get it. green bay packers quarterback aaron rodgers is no longer a cheese-head. we'll tell you why dairy is off the menu for the nfl star next. i was working in the yard, my chest started hurting and i thought, well, you need to go to the doctor. i was told that is was cancer,

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it says here aaron rodgers no longer a cheese head. that is the green bay quarterback has given up dairy. rodgers revealing a new long-term nutrition plan in an effort to extend his career and feel healthier. two-time nfl mvp has been following a vegan diet with some red meat. rodgers says he is at his lowest weight since 2007. >> no milk shakes? >> no ice cream. >> no ice cream. >> no yogurt. >> how about in your coffee? >> i would be doomed. i have done it before. i drank almond milk. >> coconut milk? >> yes. >> does it taste like normal milk in coffee. >> almond milk is not milk.

the whole thing is crazy. >> i know it's not milk. it's not suddenly a cow. >> milking the almonds. >> it's a joke. >> should be like almond juice. >> exactly. i know the things that come from udders, andrew. >> i know you know. >> mammals and breasts and stuff like that. >> manufacturers seem to not know that. breaking economic data. stick around. we'll be right back. not just because we're doers. because at sheraton, we're changing. big things. small things. spur of the moment things. ♪ changes you'll notice. wherever you are in the world.

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welcome back to "squawk box." breaking news. first quarter, final productivity and unit labor costs, we're expecting down .6. that's what we received. down .6. following an unchanged, of course, look at the previous read, which was down 1%. unit labor costs, up 4.5%. that's about a half a percent higher than we expected. following 4.1. down .6, productivity. the last look was down 1. that becomes down .6. the last quarter. down 1.7. first quarter last year down

1.8. productivity is definitely the magic sauce in a good economic hamburger. it's missing bland taste, unsustainable an the up-side and what we are sustainable at seems to be a slightly sub 2% gdp due to the productivity. i am looking at pre-opening equities. positive numbers. nasdaq only three-quarters a point from positive territory. when was the last time all three were up on the year? that will be something interesting today. interest rates higher today than they were friday after the number but off the recent highs. after the minute several weeks ago put everybody in the hot seat for normalization. the seat has gotten pretty cold. joe and the gang, back to you. >> rick, thanks. moving on to fed chair, janet yellen saying she remains optimistic about the economy. warned fed watchers not to over react to last week's dismal job numbers. she spoke with our next guest

about how she sees the hike playing out. i know johnny depp has his own problems, greg, but alice in wonder land 2 was a flop. when you see $10 trillion in negative interest rates, sovereign debt, and you see stuff like this, in your lifetime did you ever think we'd be in a period like this and what does it portend, to end of days? >> no. we're living in unusual times. times i didn't expect to see when i was trained as an economist. we're still trying to figure out what it means. i don't think we completely understand it. it has been a very hard ten years. a deep recession followed by a meager recovery. i think we're still trying to figure out why it is that the recovery is as meager as it has been. >> so greg, i mean, there are people that -- that will embrace

free markets and free-market pricing that say we're not really at zero because the central banks decided we're here. we're at zero because that's where free markets are putting rates globally around the world. is that -- is that why we're here? >> well, i think we're here because the central banks around the world are trying to figure out what the natural rate of interest is. that is, what rate is going to promote full employment. they don't know the answer to that question. it's obviously lower than it has been in the past. >> that was going to be my next question. i am wondering at this point, let's say the central banks do have something to do with orchestrating where we are right now. is it still helpful -- is it still a net positive for the economy? is it -- has it stopped working and the benefits are no longer seen, or is it actually now become a negative to try to get out of this trap? >> i don't think it's been a negative. i think the central banks around the world have been very helpful. i think the fed has done a

fantastic job under ben bernanke and now janet yellen. the fed cannot solve all problems. this is a problem of supply that technological progress is not what it has been in the past. we are innen era of slow growth. the fed can't fix that. if the fed tries to fix it, it just leads to excessive inflation. that's why the fed is inching towards normalization. they don't know how quickly they can go there. >> totally inching. the fed is going up more slowly -- i think sea levels are a millimeter a year. they're going up more slowly than that, aren't they? >> yes. they're going very slowly. before the recent jobs report they were getting ready to move again. i think the recent jobs report put them on hold. they may inch later in the summer up a little bit. i think they will. but not now in june. now that -- they want to see

another jobs report to figure out what's going on. they've always been data dependent. they never have strict time tables. as the data has been sort of weak. >> you don't see some horrific trap that we got stuck in here beings paint, painted in a corner and we're not out of zero by the time we get into another recession? we have nothing in the tanks for the next recession? >> that's one of the big risks. that's one of the things i asked janet yellen about, is she worried about it being an ongoing problem if we have another shock. she felt they have other tools. quantitative easing and forward guidance. they have other tools in their tool kit. the question is how effective are the tools compared to the normal tool of cutting interest rates. you're right. if we have another shock, there

is not much to do. >> the next president, if you had their ear, would you tell that person what to do to stimulate growth? what are the three most important things that we need to change? >> well, to some extent the president doesn't control every lever. we can't look to the president to solve every problem. if this is an issue of technological progress, we can do some things like investment tax credit, research tax credits to promote faster growth. we shouldn't expect the president to be able to solve every problem. what it will most certainly not do is what mr. trump is proposing, which is trying to isolate the united states from the rest of the world. he is -- he is appealing to the most xenophobic parts of the population. and to me he is risking an international trade war. that would be the -- absolutely counter productive. my fear is while the economy is not great now, it could be worse. look around the world and look at us compared to other

countries around the world. look at how we are to our past. things are not as bad as some make them out to be. and we could absolutely make things worse with the wrong set of policies. i am afraid the isolationist policies that trump is proposing would make things worse. >> greg, you saw the larry summers' piece suggesting the market is not taking this seriously enough and sort of thought out -- was thinking allow aloud why that's the case. is it because the market doesn't think he'll win or the market doesn't have the view that you do? >> i'm guessing they don't think he's going to win. to be honest, he probably won't. i think hillary clinton is most likely our next president. but there is still a risk that trump wins. and trump would not pursue traditional republican policies. he would pursue something very different from the free-market capitalism that i associate with the republicans. he is much more of a sort of populist authoritarian. and that -- >> which means what in terms of policy? what does that mean in terms of

policies that would be affecting the markets and wall street? >> he talks about how he'll tell companies where to locate their factories, slap tariffs on companies that don't do what he wants them to do. he talks about trade agreements that most economists think have been good things for the u.s. economy. talks about wanting to get out from under those. if you ask most economists, nafta was a good thing. i understand some workers were hurt. no economic policy is win-win for everybody. but i think overall the free trade agreements in the past have been good things for the u.s. economy. i am afraid he's going to put that in reverse. >> the is president might be trying to get tpp through but neither one of of the democratic candidates are pro free trade. >> i do worry about that as well. i predict, if hillary clinton is elected, she'll find some way to amend the transpacific partnership and become supportive of it again. she was for it before she was against it. i am guessing she'll be for it

again. >> people think they're pithy, that's what they say, that the -- the voters are worried that hillary might not do what she says and that trump will do what he says. they think that's a clever -- you know, clever analysis of it. so you think everything she is saying is to get to where she is now and she doesn't really mean any of it? >> i hope so. on the trade. on the trade side i hope she doesn't mean it. >> i don't know which of those is better. i really don't. oh, i'm sure, the stuff she's running on, my god, she would never do any of that! she would do better. she would do good things. not the things she a saying. >> her husband was a free trader and she was as secretary of state. there is a history there. donald trump as a history of becoming an isolationist. he has been talking about that for a long time. his is heartfelt. >> they both have congress and

other checks and balances to deal with. >> trump's tax plan is probably better than hillary's, for republicans. >> well, it's probably excessive. trump's tax plan has tax cuts out the wazoo that are not sustainable. the idea of a lower, flatter tax rate i think is a good thing. trump is in favor of that. i worry about the traditional aspects of trump's policy. the temperament issues are really very questionable. >> okay. no greg if it's a trump administration. you could have been a contender in the last one if romney had only been as tough on the economy as he was on trump. >> i still think mitt romney would have been a great president. >> he should have told us that instead of hiding for the last three debates. thanks, greg. when we return. cnbc disruptors. a t-shirt company that everyone

in silicon valley is talking about these days. we'll tell you what's so special about teespring when "squawk box" returns.

. welcome back to "squawk box," everybody. check out shares of ralph lauren this morning. retailer announcing it will be stream lining its organizational structure, cutting costs and reducing its real estate assets. it sees net revenue for the current fiscal year falling in the low double digit percentage range. it says it will be hurt by store

closures. you hear about the big stores shutting down stores. a pull-back in inventory, receipts and weaker traffic. stock down 10%. >> apparel, right? >> yes. apparel that's sold in department stores. >> basketball news. basketball great shaquille o'neal and phil jackson reunited last night in new york city. the two men won three nba titles together with the lakers at an event for american express card holders. cnbc caught up with shaq who goes into the hall of fame this year to talk hoops and technology including mobile payments like apple pay. >> there is no secret that i am probably one of the world's biggest geeks. and anytime you can just pay without using cash i think it's a good thing. the best thing i use apple pay for is when i'm on itunes. it's fascinating that you can buy a whole album or movie. just touch it and it comes instantly. that's fabulous to me. >> as for this year's nba finals, shaq says while you

can't count lebron james and the cavs out yet, it would be difficult for them to get back in the series with steph curry and the warriors. i think he said he doesn't plan to watch it on tv. >> maybe he's like us. >> too late. >> it's on at 9:00. i can't even watch the pregame really. this will be interesting. really? maverick? golf prodigy maverick mcnealy not sure he'll go pro. the stanford star and the son of that man in the ugly hat, telling the "wall street journal" he is considering passing on pro golf for a career in business. he is the second-ranked amateur in the world. i didn't know -- >> i knew he was good. >> five years ago he was with his dad and shooting in the low 70s. i didn't know -- to be a pro you have to be incredible. less than a year from his expected graduation.

>> not bad to have two possibilities. >> probably not huge student debts and stuff at stanford. maybe he needs to get out into the work force to try to -- you never know. >> his father is a free market-eer. maybe he would want that. the rollout of the cnbc disruptor 50 list. this is a t-shirt company that's attracted some of the biggest names in silicon valley. teespring. walker williams is here. the company's co-founder and ceo. he has brought us exclusive cnbc design. >> somebody took them. >> they were snagged? >> i appreciate you having me. >> the thing about -- as i said, a t-shirt company, not necessarily -- >> sure. >> -- thought of as some kind of great innovation, but you have a lot of huge, silicon valley investors because you've tried to take the friction points of

making a shirt away. >> the biggest thing is counterintuitive to the name. it has very little to do with t-shirts. the premise of teespring is, if you remove all the barriers, the friction, all the risk and all the costs between when a creative person has an idea and what it means to bring it to market, you get a new wave of entrepreneurs. that's really what we do. in a sense, we launched in 2012. entrepreneurs on the platform have made more than $200 million, $300 million. 40 or 50 people have now become millionaires on the platform. from the stay-at-home mom to the designer just coming out of school. >> what was the eureka moment for this company? what was it about? >> it was our squawk-ward moment. >> nice! >> it doesn't say brought to you by -- >> it should.

it should. you can go design that one today. but the eureka moment. i was a student in college. broke as most students are. and my senior year the local beloved dive bar at brown university got shut down. i came up with -- i was a designer, came up with a design to do. decided to make a little money, commemorate the bar closing. quickly found that it was full of cost. it was full of risk. almost gave up. at the last moment came up with -- >> full of cost because the t-shirts were expensive. and full of risk because you had to buy -- >> you have to know exactly what sizes you need. big box. customer service. for all the creative ideas, only a few actually make it to market. >> are you more than a t-shirt company? >> absolutely. >> you described yourselves as a platform of sorts for entrepreneurs. what's next? >> t-shirts are to teespring what books were to amazon.

a way of proving the hypothesis if you remove risk and costs, a new wave of entrepreneurs ari s arises. the ability for any designer, anywhere, to create a brand -- >> i go to you not just for t-shirts but i'm going to try to make pants? >> we're not announcing exactly what's coming next today. 2016 will be the year that we massively expand the product lines that we offer. >> how many do i have to -- like -- let's say i want ten extra large t-shirts saying "squawk box" can i do that? >> sure. you come. you design the shirt. even if you got one sale, it would be manufactured. >> i just want the shirts. >> one of the things we pride ourselves on is the retail-quality product. we have an amazing -- >> who makes the shirts? >> we have a facility out in kentucky. 120,000 square foot. >> those shirts are made by

american apparel, though. >> we have a selection depending on who your audience is, who you're appealing to. >> it's easier for me to buy ten t-shirts at a is people who want to start a brand. >> i don't want to start a brand. >> the whole point is you're going to start a company. >> no, i understand. m t-shirts are getting old. i got them like ten years ago. i have a uniform when i go home. it's usually a long sleeve t-shirt with a short sleeve t-shirt on top of it. have you ever seen that? >> right now it's about silkscreening on the t-shirt, right? >> yes. >> do you foresee a time where you're actually designing the t-shirt or designing a garment? >> it's definitely something we look at. we think of our role is looking at what these creative people and designers are trying to do. and enable them. it's one of the reasons we signed last year partnerships with the nfl and nba to use their license marks, first time those leagues have done something with user-generated

content. >> how is that working? what happens when i go on and want to make a shirt with one of these licensed deals but i want to write something that maybe they wouldn't be so happy with? >> when you do something with license market it does go through review. they would make sure it promotes the brand in the way they want to be promoted. but you can do that and it's the first time anyone's ever been able to do that. >> what's the most expensive shirt has ever gone for? >> we've had shirts more charitably focused go for upwards of $100 to $200 a shirt. the average is closer to $20, $25. >> okay. walker, thank you. congratulations. >> thank you. thank you for having me. later this morning we're going to hear more from our 2016 cnbc disrupter list, joanne bradford will be on the show. and then how do you say houzz? number 11. i've used that website before. do you know what we're talking about? >> of course. >> 11:00 a.m. eastern time. don't miss it.

>> it's probably houzz. >> people are addicted to that website now. >> is it pretty cool? >> anyway, coming up, jim cramer joins us live from the nyse. we'll get his take on the day's top movers.

let's get to the new york stock exchange, jim cramer, intraday high possible today, jim. we made it all the way back, i don't know whether the economy's better, but we're still going to get some help from the fed, i guess. >> well, i think a lot of this is just the dollar not going higher. a lot of it is oil. i mean, when oil's strong, people like the market. that correlation's not been broken. remember brick. you let russia back in. brazil's a disaster. but maybe someone can fulfill role. i think what happens is people feel better regardless of what's

really happening, just simply because the industrials do better and the drugs do better and consumer packaged goods do better because the dollar is not going higher. i think the dollar's been crucial the whole way. and every time you look at the dollar and the dollar going down the s&p goes up. and dollar of course linked to oil too. all these things come together every time the fed does nothing. >> have you ever figured out in your long career, jim, how to tell a story stock that actually works and goes up 30 times in value versus a story stock that is just that, a story stock? how do you tell the difference? >> well, i think you have to make a decision about whether people like the product. and if people like the product enough, then the story stock can go up finally enough to realize the goal, whether it be amazon or netflix. >> the storage things, huh? >> there was a core group of people that like to talk about the product, they didn't necessarily find that -- >> what about that photo technology or something? i like the taser. >> 3d printing.

>> don't kill the person, just tase them, bro. >> 3d printing, people loved that for a while. but i do think what happens with tesla -- >> who wants to shop in a catalog on a plane? thanks, jim. >> if everybody could get a tesla, nobody would want one. >> okay. stay tuned. thank you. ordering chinese food is a very predictable experience. i order b14. i get b14. no surprises. buying business internet, on the other hand, can be a roller coaster white knuckle thrill ride. you're promised one speed. but do you consistently get it? you do with comcast business. it's reliable. just like kung pao fish. thank you, ping. reliably fast internet starts at $59.95 a month. comcast business. built for business.

check out the futures once again. nasdaq has been up eight of the last nine sessions. s&p 500 closing at its highest level this year. you can still see futures up with the dow up 40 this morning, s&p up 3, nasdaq up 7. have a great day, everybody. we'll see you tomorrow. right now it's time for "squawk on the street." ♪ good tuesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. futures off their highs but market steady after janet yellen hinted about the fed's thinking on monday. rough opening for valeant and ralph lauren. new polls on brexit to look at today. productivity revised down for q-1. brent a new 7-month high above 51. road map begins with ralph lauren shares taking a big hit. company annnc