good morning. welcome to "squawk box." joe kern than. becky is off. we have a big morning of earnings report. the fed two-day meeting kicking off today as well. let's take a look at the market action before we equity things kicked off here. u.s. equity futures at this hour looking down. dough looking off about points and the nasdaq down about 7 in well 7.5 points. overnight in asia looking at a mixed picture. down almost a percentage and a half. we fly over quick to europe, you're going to be seeing again mostly down arrows there where the exception of what's taking place in the england today and finally a quick look at crude. wti now down to 42.82. so harold ham, not only did you

saw wire going to have the trump rally. >> within what time frame? >> i think in the next couple of months. >> 45 is a number that -- 45 to 50 is the number the market likes. >> it does. >> yesterday when oil was slumping, that's when the equity started. it's almost as if we get close to that three handle again and people start worrying. the market was just off oil. that was the key thing to watch. >> you put up a couple weeks of inventory build. couple weeks of rigs coming back online. >> was it supply. >> i thought it was trump so i'm confused. >> reoccurring worries come back. >> we'll see. 42.79 touched the lowest level since april. >> once it gets three handle again it's hard for markets to make headway. >> what is the level which it

stops becoming a positive for the consumer. >> remember last time it should have been great at 27. >> all the banks now everybody can refinance their loans, energy companies aren't going to go bankrupt. >> it brings up fears of -- we had a guy yesterday talking about the recovery long in the tooth. every time you see oil, i think people -- even though we know it's supply, people always extrapolate maybe there's demand problems. the brexit we have done nothing, but go up since brexit. oil went below 45 and sort of derailed all the positive feelings. i don't know. it's weird. >> couple of things we're watching on the calendar today, housing and consumer data in focus along with a host of other earnings reports. many are hitting before the bell. new home sells, that sits at ten. boast are expected to confirm steady momentum building in the

housing market. at 10:00 a.m. we get the consumer market. and the fed kicks off a two-day meeting today. the decision is due tomorrow. 3 m, caterpillar, lily, mcdonald's and verizon all report earnings before the opening bell today. after the close apple and twitter as if we needed more to work with. a couple programming notes, we'll have the ceo at 7:15 and caterpillar who will join squawk at 8:00 a.m. eastern time. certainly great voices to have joe, joe, on just the global economy and running a global business. >> yes. pharmaceutical is a little different, but caterpillar, get a good look at the globe and what's happening. also, we have 500 in the s&p. how many stocks in the s&p 500. >> it's more. it's like. >> but it's around 500. that's why it's called that.

if we're going to do all of them we have to mention ones likes texas instruments and those shares are actually rallying. firm also offer add strong outlook on an increased in demand. the drug maker decided not to pursue approval of imfoe ma treatment of late stage study of this particular drug. las vegas sanlds fell 30% as a decline in macaw hurt itself results. >> bit of beer news. ab inbev raises bid for sab miller. inbev will now pay 45 pounds per share. says it will review the revise ds offer. also the federal reserve some enforcement against goldman

sachs related to the leak of confidential information of one of its employees. fed is considering taking action against a former goldman sachs executive who has access to the leaked material. it came from a former executive at federal reserve. >> should we quickly do duh ponte earnings. against the estimate we're going with. revenue $7.06 billion that was a beat as well. operatinginining eps for the fu. that was on the high end. they now expect negative currency impact for the full year to be about 15 cents per share which all in is a pretty

modest guide right there. we'll dig through those numbers and get back to you. currently premarket shares are unchanged. >> we'll see whether it actually trades up like that. day one of the dnc convention is in the books. john harwood joins us now with more from philadelphia. were you on the floor for the gavel, john? >> no, i was in this booth for the gavel. >> in the booth for the gavel. >> crazy start and i don't know. nothing is shocking anymore in this political year, i guess. >> joe, it was a fascinating start to the democratic convention. clear expressionings of dissent. it didn't do that early in the day, but in the evening, democrats took three different approaches to try to bring their party together. first they tried a little bit of

humor. senator al franken, former saturday night caste member came on with comedian sara silverman, spoke to them drengtly. at one point when they were giving her a hard time, she chastised them. take a listen. >> can i just say to the bernie or bust people, you're being ridiculous. >> reporter: democrats tried two of the most powerful liberal icons that they have, bernie sanders himself was the cleanup speaker, but before bernie sanders, elizabeth warren, made the case against trump to set up sanders. >> trump thinks he can win votes by fanning the flames of faear and hatred, by persuading you the real problem in america is your fellow americans,s people

who don't look like your or talk like your our worship like you. >> any objective observer will conclude that based on her ideas and her leadership, hillary clinton must become the next president of the united states. >> the emotional heart of the evening was the address by first lady michelle obama, which led off the 10:00 p.m. hour. michelle obama of course in the nonpartisan role of first lady did not have an overtly cast of the speech, but very political in a powerful way. without mentioning trump's name she said the election is about setting an example for our children. >> in this election and every election is about who will have the power to shape our children for the next four or eight years of their lives. >> there is only one person who i trust with that responsibility, only one person who i believe is truly qualified to be president of the united

states and that is our friend, hillary clinton. >> reporter: strong testimonial from the woman who of course along with her husband ran against hillary clinton eight years ago. we'll see whether that's effective at tamping down some of the bernie or bust people that sar have a silver man was chastising. and tonight we'll here from bill clinton, he's been great at democratic conventions in the past. four years ago he gave a strong economic argument that benefitted president obama. see if he's still got it tonight. >> i like the way you said that. a little comedy from al franken because i'm familiar with his work on saturday night live. it was very little. >> it was on an snl episode. i can't watch him without tom davis. >> i watched him back then. it was very little comedy as well. i think one of the weird things, john, and it's true, my children

grow up over the past eight years and it does matter who is in the white house. they're watching now a battle royal in one of the main parties in this country between socialism and capitalism as a form of economic -- as a form of an economic system. so that does make a different. >> which side are you on? >> i think it's very strange that we're half of that convention center is pining for a self branded socialist. >> well, it's not half joe because hillary clinton won the nomination so she got more than 350. >> yes we saw the ems though john and the super delegates so we know how she won. >> she won a majority of the pledge delegates too. >> why you have some bernie sanders -- they adopted the locker up line. >> i know. >> you've got democrats with the locker up line.

very dark. very dark. anyway, john, very dark. >> we're going to turn to our next guest right now. democratic strategist, good morning to you. you saw what took place last night. i also imagine you might have seen the polls over nights. cnn now projecting for the first time that donald trump is not just in the game, but could win this thing. also nate silver out with his own new statistics saying the same. given what could be a divide in the room last night, do you think there's going to be enough people coming out to support hillary clinton. >> absolutely. when it comes down to the divide, i think it makes a good story, especially when in between the two conventions there's not a lot of real stories going on so the bad one kind of jumps into the void. look, i was in the hall for the majority of the afternoon, and of the evening, what you were seeing was a vocal and, you

know, visually powerful, but a slim minority. when it comes down to the folks who saw sara silver man so bluntly and honestly and brilliantly took the argument very forcefully. that was a small minority. early on in the afternoon there were more kind of bernie sanders activists in there, but when you had elizabeth warren, and a true activist, a true activist with a real record behind her address the kr0ud crowd, when you had michelle obama. >> i wasn't there, but i was watching. i heard chants of we trusted you, past tense, when she came on the stage. >> right. which by the way is a ridiculous gesture because the movement the bernie sanders support really belongs to elizabeth warren in its reality so that was distressing to hear.

however i was in the hall and the voices were scattered and cameras may have run towards them. that was no way even in the majority of bernie supporters. it was a small majority that represents no way what the mood and energy was in the room and the mood and energy of the party. i think made a lot of strides yesterday towards unity, something the republicans certainly did not manage to do after their convention. which was a dumpster fire. >> last week at the republican convention, the unifying theme was being against hillary clinton and the thought was going into the dnc that the democrats were going to be proclinton and not have to mention trump or not want to mention trump and his policies by name at all. certainly we didn't see michelle obama mention trump, but the fact hillary clinton's flame system eliciting boos from the crowd, are people going to have to start rethinking their messages going through this week. >> i don't think so. again, if there is boos from it

will crowd, in either party, there's always going to be a purity driven activist wing and that is m part of where energy comes from and where p ideas come from and that's fine. again, tiny tiny minority that should not be con affiliated in any way. everybody gets a convention bounce. that story is as old as politics. i do not see that as in any way sticking when americans, you know, see the contrast and the two -- and the choice they have to make. every election is a choice between two people. 2013 donald trump and hillary clinton who as sara silver man said is the only person possibly overqualified to be president. i think that you're going to see a very, very definite clear win to hillary clinton, and i think

we're going to wait and see polls after both conventions and after the tim kaine roll out which went wonderfully. america didn't know tim kaine all that well and really fell in love with him. he's going to be a great asset to the ticket going forward in a way that mike pence is not an asset and really, really reveals that the trump campaign knows that this is a -- with any shot at success is going be a play to the base, play to alter conservative white guys possible scenario for them. >> john, one of the things we've been talking about on the show for the past several weeks in relation to brexit and this campaign is about the establishment and the anti-establishment if you will. the seleintellectual and anti-intellectual. typically in the past you would have called that support. and you would have thought that was a good thing.

in this new anti-establishment world that oftentimes is a bad thing. how is that playing out in this idea that hillary clinton is the establishment candidate. >> what's interest sg that hillary clinton sort of rose to prominence, but being anti-establishment. you can't call the first woman partner in a southern law firm in the 70s exact establishment or someone who dedicated their life to the children's defense fund. >> in the context of this in a world where everything is relative, she's about as establishment as they get. she is the establishment at this point in the game. >> i'll address your point in the a second, but i think donald trump a billionaire businessman is pretty establishment too. a man on fifth avenue and has his name plastered all over the place. i think bernie sanders is establishment. you can't say someone who served in the congress, tleechl decades is anything, but establishment.

there are rumblings and i hear your point on brexit. there are certainly rumblings of the institutions which hold us altogether and establish the rules for a long time are being thoroughly thoroughly questioned and i think you've seen that play out in both primaryings. a lot of it is what the messaging is. i don't know the substance in terms of legislate laytive agenda, but certainly you've seen a rallying cry play out on both sides. >> fair enough. great having you with us this morning. >> thanks for having me. >> thanks. see you soon. >> you got it. >> coming up, an update on the california wild fires forcing thousands out of their homes and then later the fed kicking off a two-day meeting as an earnings braid hits wall street. get you set for the trading day ahead, but first this day in history.

growing beyond 33,000 acres and 20,000 people have been ordered to leave their homes.

3,000 firefighters are battling the blaze. about 20 buildings have been destroyed including the famed sable ranch. it was a set used for a lot of tv shows over the past 50 years, including the 18 and 24. and i know you probably saw the movie, the 18, but there was. >> not a big movie person. >> because i know you have not seen the tv show. >> come on. >> i watched one episode of 24. >> you've heard of mr. t. >> what are you talking about fool. >> pity the fool. >> yes. >> that was the guy. >> i need just like a list. i need a to-do list. >> from your time. >> we had one or of anchors say bruce spring seen the. i think of him as someone my

parents listen to. >> i wouldn't go there. maybe beetles. let's get a look at markets. u.s. equities would open fractionally lower. s&p down by two, nasdaq off by about six points. largely reflecting some of the sentiment we're seeing in europe. france is marginally down, italy down the worst. down 1.25%. spain down close to 1%. germany and uk fractionally positive right now. a lot of this is based on the moves in oil. wti yesterday broke through 45. slid bringing the energy sector with it. brent was down. crude again is down another 1% as is brent. gnat gas down as well. take a look where the yield is. . certainly a lot of companies able to refinance at this. we see wells fargo, reports

because we've seen healthy spreads in the credit markets. certainly something to watch there. the euro is firm. dollar yen is in tin focus toda the pound is basically unchanged at this hour as well. for more on what investors need to watch, we're joined by michael zin. david leave vets global market strategist at j.p. morganen funds. >> thank you. >> who in their right mind would be out buying ahead of the fed and ahead of japan this week. >> volatile is the opportunity here. you have elevations fairly elevated. we have a global post-brexit and we have ale p decedent earning season and this is an earnings driven market and we've successfully sort of climbed the wall of worry here. we made new highs. and it has been accompanied by

up until yesterday very low v volatilit volatility. it's not unusual to see post volatility periods. we would embrace that volatility. a way to buy higher quality companies at better discounts. >> have you been surprised we haven't heard a lot of companies talk about brexit as a anythingtive, talk about the stronger dollar as a negative. those issues have largely been absent from a lot of discussions. >> it has been a little bit surprising, but the bank of england hasn't said what their response to brexit is going to be. the ecb has taken the same approach. we just don't know enough. in a risk off environment from a corporate standpoint, i don't think the ceos want to put the cart before the horse. to your point on earnings, i think investors are refocusing on the fundamentals. reminding us it's about expectations. year over year, earnings growth

is still negative, but we're seeing companies beat analyst estimates. that's putting pressure on stock prices. >> at some point in the future, they're going to do article 50 where at some point two years after that something will happen. it's hard to trade or find any actual effect other than the fear. >> it's hard for companies to hedge too. >> we're all going be dead from a big tidal wave. how do you trade global warming so we sell everything today. >> it's straight out of the european playbook. kick the can a little bit further and maybe it will address itself. >> that's assuming the 100 economists are correct it's a disaster when it happens, other than versus the other people that think you know we're gaining sovereignty and the management of your own affairs

would be appositive. people are lining up to do trade deals with the uk. who is going to go to the end of the q, nobody. >> it's our view brexit is a local issue. we don't think it has a terrible impact on the. it seems like the market is saying i will admit the market was wrong before brexit, what the market is saying this is a regional issue. not really affecting the u.s. and back to your point focusing on the low volatility improving fundamental environment. >> markets were worried about oil again. it's 42. >> oil has been the boogy man for sure. >> not people turning back on. it's huh-uh. we want it low. we want it stable. the other thing i would add on brexit is here in the u.s. depending on how you measure, you have a lower 10-year

treasury than cpi, that for serngs a pretty positive thing. if you have brexit continue to pin down u.s. rates because of this global post-brexit yield chase, that's actually pretty good for the earnings outlook. >> they're still so highly valued. when you break down by sector, the valuations of the energy sector is 53 times earnings because they're not earning any money. >> i like getting back off the canvas. if your normalize oil the picture can look better. we shouldn't get ahead of ourselves, but i think that a lot of that is just you know last year's picture and not next year in the forward year picture, but generally it will valuation of the market really depend on what sector you look at. you can easily make the argument there is some overvalued sectors. you can argue that areas like health care are undervalued. >> sort of glass half full kind of guy. >> i like to be. it's a better outcome that way.

>> what would you buy this week. >> we're in a very similar camp when you exclude energy where valuations are warped by the lack of earnings. in general look cheap relative to defenses. we prefer a lot of the sectors you just mentioned. when i look at the market we have a combination of expectations of the banks are going to ease further. improving earnings fundamentals, decedent economic growth after a very weak quarter. there's a lot priced into the market right now, but upside from current levels. >> thanks to both of you appreciate it. >> thanks for having us. >> is it a bird, is sit a plane, no in this case it's a drone. amazon taking to the skies. we may be getting closer to that in reality. we're going to tell you what the delivery giant is up to now. plus around the world with stefen romero fuel, the first solar powered flight making the first landing in history. details next as we head to a break. take a look at s&p 500 winners

and losers. (speaking japanese) oh watson, your japanese is very good. thank you. (speaking japanese) exactly. i can understand nuance, context and idiom in seven languages to help companies all over the world with everything from retail solutions, to banking, to cyber security. (speaking japanese)

"world wide exchange" the force is with u.s. toy industry this year. demand for "star wars" merchandise set to propel toy sell to a 17 year high. that's according to a research group. collectibles inspired by the rebooted star warz franchise nearly tripling through june. the toy maker expects star wars merchandise sells to hit 500 million. he was funny when he was on

saturday night live. was a bona fide comedian. >> you're making an al franken joke. >> you're making a serious comment. >> making a reference to al franken. >> time for this mornings executive edge. nike ceo total compensation nearly tripled to $47.6 million for 2016. that's according to a regulatory filing. the increase can be attributed to a big increase in stock awards after parker took over the role of chairman. since becoming ceo, he has helped the company take in more than $32 billion in sales, which is more than double the level when he took over. the 60-year-old executive has vowed to increase nike's earnings to $50 billion in just a few years, by 2020. >> and check this out, similar impulse two completing historic

trip last night. first round of world similar power flight. taking more than a year to completely and spanning over 25 thousand miles and it landed in the dark. >> and amazon saying its entered into a p partnership with the british government to begin using drones for delivery by the far off year of 2017. and it's working with britain's aviation regulator. >> by the way, you should be upset about the u.s. regulators, they won't let them do what they're doing in the uk. >> it's going to be really big mosquitos. the tests are a important sign of confidence in britain after its vote to leave. i don't know what i want with drone sgls the issue is right now the if you're a pilot of a drone in the united states you have to be in visual eyesight of

the drone. you should be against all regulations. the uk opening up and saying you don't have to see the drone. you can operate multiple drones at the same time. you can do basically whatever you want. do you like that? i would think you being the free marketeer you should love that. >> but if they could bring you a new golf club been an hour or something, you would like that. >> i've learned over the years, it's really not the club. i've tried. it's not the shaft. it's not the club. it's not the club face. it's not the grip. >> you've explored the possibility. >> yes. >> by the way,ky get you a reservation now at the four seasons finally. >> oh, you don't mean jersey boy. >> no. we can find you a seat. now we can find you a seat. >> everything must go at the one time power lunch. this is why a seat is available for joseph.

the big spot in new york city for the elite, the entire contents of the four seasons restaurant is up for auction today. the four seasons which was located on manhattan's east side shut its doors earlier this month. also up for auction the famous barcelona chairs and audit mines from the lobby and the chairs in the ladies lounge. artwork including a rare tapestry by picasso will stay. >> do they have a flu locatinew >> they are coming up with a new location. >> there's going to be a new restaurant that's going to be quite remarkable in that space. with the picasso tapestry. >> i think it's gone. they've taken that out. >> it's not for auction.

they're not sell lg that part of it. >> it's not there now. i thought they took it off the wall. >> hanging out in closed restaurants? >> no. if you've been to the restaurant in the past two years, they took it down. >> oh. you say four seasons to me, i don't think franky valley. >> there's many of them. >> i think of pleasant. >> there's one hiere in new yor. >> why yes, there is. >> it's still pretty popular. >> maybe i couldn't get a table there once so i trashed it. anyway, coming up, how the election can change nay to and r raep with our allies.

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welcome back to "squawk box." keeping an eye on the price of oil which largely drove the market action yesterday, reversing four straight weeks of gains to open the last week of july in negative territory and that's where we closed as well. currently wti is down 1%, brent is fairing slightly better. nat gas as well. we'll keep an eye on that as we touch the lowest levels since late april. >> day one of the dnc convention kicking off yesterday. joins us now with more is general wesley clark. good morning.

i'll guess we'll here some talk about terror and security this week. just recent poll i saw i think a year or two ago, the number of americans saying they were nervous about a terror attack was in the low 50s or maybe below that. it's 80 plus percent. i know the frequency in the what we see in terms of a truck running over 85 people just we know what terror is designed to do and it seems like even the severity of it and the frequency have both gotten worse. should americans at some point be worried if we continue along the same track that it will come here and there will be something horrific -- more horrific if you can imagine than orlando and san bernardino. >> i think we do have to stay with this programming. this has always been seen as a

long war. now, retired marine general is going to be addressing the convention on thursday. he's got firsthand experience in this. i think his experience is going to be in his comments are going to be very welcomed at the convention. admiral jim was part of the vetting process for hillary's vp so he's another one on this team who has a strong national security credential so yes, i think americans haves to be concerned. i think democrats have a lot of confidence in their leadership team and hillary's experience and what she's done and i think this is a problem. it's like many other challenges in modern life. going to have to live with this, going to have to work against it. it is a long-term set of issues. >> i just wonder if you were in europe. if you were put you in charge of security in the eu, i wouldn't know where to begin in terms of, you know, the number of people

that may be imbedded in society that you have no idea about already and the influx of new people as increasing every day as well. i don't know how you -- whether you need to tackle the ideology or whether you need to get mainstream muslims to reject the o ideology. what scares me is biological weapons or nukes or a loose nuke or told by the president it's not a threat to us, but i think it's pretty existential at times. you put a nuke in a major city and stock market would probably go down 10,000 points. >> the united states has been working against dirty nukes for many, many years. one of the first things we worried about after 9/11 so there's a lot of experience in this with the united states. with respect to europe, what i would tell you is this, first of

all the europe european have to break down. they need a counter terrorism center like we have in the united states. their intelligence not only stove piped within nations, but also stove piped within agencies within nations so that's the first thing is information shares. second thing is take action. they've got to set priorities. they have to have common leadership on this. and work it. there's threats in europe. they can be dealt with, but they're going to require innovative strong political action and europe is as an organization has always waited until the last minute to take those kinds of actions. they've always had to be pushed. hopefully what's happened is sufficient to energize you were to ta europe to take the actions necessary to protect itself. >> how do you feel like our military is -- has all it needs

for dealing with the threats of the next decade? >> i think the military in this country is -- we've got to both deal with the terrorism challenge. we've got to finish what we're trying to do or stay with what we're trying to do in the middle east and deal with terrorism there and north africa. we have to recognize there's a whole new generation of weapons and potential danger coming from technology from hyper sonics, from unmanned aerial vehicles, from high energy lasers, and these technologies have to be invested in. imbedded in the fore structure. they have to be parking lt of o military doctrine. this requires resources. >> you didn't mention air conditioners. i heard secretary kerry yesterday. and air conditioners. >> air defense is absolutely critical. >> i did not mention air

conditioners. >> secretary kerry did yesterday. >> general, i want to ask you about nanato. obviously you have experience being a commander in nato. i'm wondering if you think nato's role in the current conflict should change and if it will u.s.'s role within nato should change. >> the key thing here is we have to get the intelligence system right. nato has always relied on u.s. intelligence in the main and we share intelligence with only a very few countries. really just canada and the united states within nato. and britain so to get that information out and then to get their information in fully, there's a lot of work to be done behind the scenes. before we can talk about how nato acts, we have to talk about how nato information is protected and exchanged. when you deal with intelligence

cooperation, you're dealing with the gold bull yen of the 15th century. information is critical for. >> is there a way to level the nato playing field among its members? >> the nato playing field? i think you may be talking about expenses. >> yes. >> so if you're talking about burden sharing, well, the united states has a global role in a way that nato doesn't: we've always pent more than our allies, but i was in estonia twice this year and i've been all through east europe. we found in the 1970 when we had the military modernization then and nato came up with long-term defense program of 3% more real resources each year and i was with general hague as one of his

executive officers at that time, an army major, but i remember what a challenge this was to bring the european nations together, but we did. we faced we'll bring nato together this time to face the challenge of resurgent russia. >> where were you? were you on the coast in estonia? >> i was in taland. >> beautiful, huh? >> it's a great city. it's a great country. i love the baltics. but -- and they're our allies. >> andrew's taking notes here. the baltics. estonia. >> sounds beautiful. >> estonia, latvia, lithuania. >> it's cold up there, isn't it? >> estonia's right there, yep. >> general, thank you. we appreciate it. >> they'll be the first to face it. thank you. >> we appreciate it. thank you. coming up, earnings central about to reach a fever pitch.

caterpillar, united technologies, verizon, and that's all before 8:00 a.m. then it's mcdonald's. that stock up 32% in the last year. trading near an all-time high. what can investors expect from the golden arches? that's up next on "squawk box."

welcome back. quarterly results from fast food

giant mcdonald's set to hit the tape in about an hour. susan li joins us here on set with a preview. >> so the restaurant industry is in a slump. mcdonald's should do better than most. we're looking for earnings to rise 10% from last year. revenue will be down 3% from a year ago and people really look at comp sales and same store sales which is a key way to gauge the restaurant business. we're looking for global same store sales to be up 3.6%. the analysts i spoke to said in the tough fast food industry, mcdonald's might be a better bet than most. and they're still benefitting from cheaper input costs like cheaper beef. mcdonald's usually has long contracts with their suppliers so they will benefit from the cheaper prices. and the two for $5 value menu, it hasn't been a huge hit, but mcdonald's is trying to get

innovative and healthy and with the time. fresh beef in quarter pounders, preservative free nuggets in the future, big and little big macs and the stock had a bit of a bounce last week after it introduced in japan pokemon happy meals. they may be partnering up with nintendo and pokemon in the rest of the world. >> although that won't affect the previous quarter's earnings. >> i kind of want some mcdonald's breakfast right now. coming up, the earnings pouring in. we got a lot more after the break. plus back to the dnc. we've got former pennsylvania governor ed rendell. he's going to join us next on "squawk box."

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all rights meeting in philadelphia choose their presidential nominee. and today's roll call vote for the nomination could bring more drama. the latest from the democratic national convention is straight ahead. the earnings parade marches on. the ceo of eli lilly joins us first on cnbc. plus a deluge of dow components set to report including verizon and 3m. the numbers and market reaction just minutes away. plus what happens when you catch all the pokemon in pokemon go? you get sponsored. that story plus your business headlines as the second hour of "squawk box" begins right now. ♪ live from the beating heart of business, new york city, this is "squawk box."

>> welcome back to "squawk box" here on cnbc, first in business worldwide. i'm joe kernen along with kayla tausche and andrew ross sorkin. the futures at this hour, they are flat most and turned positive at least for the dow. the s&p indicated down over a point. the nasdaq indicated down four. and oil as we have referenced a couple of times already today is touching a three month low. if you go between 40 and 45, so does it go below 45 or above 45? unclear now. i think a three handle would maybe indicate to people there's some type of global growth problem again. and that could be bad for stocks. we'll see. give you some earnings this morning. earnings of $1.82 per sure for

united tech. also beating revenue street forecasts. reached the bottom of the guidance by 15 cents. it's now $6.45 to $6.60 per share. estimates are at $6.55. we also have verizon just reporting and crossing as we speak. i think i can pick that up. >> yeah. it's at 94 cents per share adjusted versus 92 cents estimated for this second quarter. we are seeing that consolidated was 17 cents in earnings per share. they did see 615,000 postpaid additions for this industry. 3.7% fios revenue growth. cash savings over the term of what they were negotiating. we'll make our way through this press release and get more for you later on.

here's what else is making headlines at this hour. dupont one of six dow components reporting earnings this morning. the chemical giant earned $1.24 per share. that's 14 cents above estimates. dupont also raising its full year forecast. eli lilly meanwhile earning 86 cents per share. the drug maker's revenue was above the street with lilly benefitting from sales of diabetes and cancer treatments. the ceo will join us in a minute to discuss the company's second quarter. we'll get two snapshots of the market this morning. and just an hour later, 10:00 a.m. eastern time, the governments report on june new home sales. let's talk politics for a moment. bernie sanders taking the high road as he urges his supporters hillary clinton is the right choice for president last night.

>> we need leadership which brings our people together and makes us stronger. not leadership in which insults mexicans, insults muslims and women, african-americans, and african-americans and seeks to divide us up. by these measures, any objective observer will conclude that based on her ideas and her leadership, hillary clinton must become the next president of the united states. >> eamon javers joins us from philly with more. eamon? >> reporter: yeah.

good morning, andrew. turns out that the democratic party here in philadelphia has pretty much the same problem that the republican party had in cleveland last week which is how to bring the entire political party together after a very divisive primary. we were out in the streets of philadelphia yesterday with a very large pro-bernie sanders crowd of about a thousand people or more. they were carrying signs that said hill no. they were saying hey ho did rks nc. that was the mood going into last night's opening session of the democratic national convention. and the challenge of the democrats in the room was to bring those people on board. it was very difficult in the room. lots of booing at any mention of hillary clinton in the room. but then you have this one political figure in the american landscape that could bring all those democrats together and that was the first lady of the united states, michelle obama. here's what she had to say last night. >> when someone is cruel or acts

like a bully, you don't stoop to their level. no. our motto is when they go low, we go high. >> reporter: so you heard michelle obama there talking about when they go low, we go high. saying we have to take as a democratic party a higher tone than the republicans are taking under donald trump. and then you heard bernie sanders in that sound bite you just played coming out and making the endorsement, doing the thing there that ted cruz couldn't bring himself to do at the republican convention last week. endorsing hillary clinton saying that she's got to be our candidate to defeat donald trump in the fall. the question, though, is whether those protesters we were out with are going to go along with that endorsement. whether this movement has detached itself from its leader who is on board with hillary clinton and the movement says we're going to sit at home. that was the sentiment of a lot of the people we talked to here in the streets yesterday. >> eamon, we appreciate it. i will take that question to our

next guest because it's a good one. former pennsylvania governor and philly mayor ed rendell. he's chairing and is the host committee of the democratic national convention. i don't know if you heard what eamon just had to say, but this idea of do the bernie supporters actually come out and go to the polls and vote for hillary? >> well, i think eamon is making a common mistake that the press does. they interview a thousand people and conclude that's the mood of the sanders supporters. bernie sanders had 13 million votes and 2.7 million contributors. look. by the end of the night, there wasn't a discordon note. first when bernie sanders got introduced -- actually, first, sarah silverman of all people did a great job as a loyal and avid bernie supporter. she said to the bernie or bust people, you're being ridiculous. and that got tremendous cheers from everyone in the hall.

not just the hillary people. then keith ellison when he introduced bernie, the congressman who was an sbeg gral part of the campaign did a great job telling supporters it's time to get on board. then bernie himself did an incredible job following michelle obama. he didn't just endorse for two sentences. he spent 15 minutes going through issue after issue after issue explaining why sanders people who cared about issues should be for hillary clinton not donald trump. so will we get 100% of the bernie sanders voters? no. but i remember when we left denver in 2008, only 60% of hillary supporters said they would vote for barack obama. hillary campaigned vigorously for obama all fall. on election day, 95% of hillary supporters voted for obama. i think we'll get over 90% of the sanders supporters. >> just listening to everything, it's going to be an interesting

week. this is joe. i was just thinking, let's say you have a fervent bernie sanders supporter who decides, you know, i like socialism. i like this socialist. hillary's close enough for me to switch my allegiance because it's not going to be bernie. so she'll be close enough to a socialist that i will throw my weight completely behind her. what does that say to people that think that capitalism and free markets and smaller government, what does it say to people if the people that love bernie sanders say hillary is close enough to a socialist that we'll back her? that's not an endorsement for me. >> i don't think that's the reason they'll back her. i think the reason is they'll compare where hillary clinton stands to where donald trump stands. they'll compare the tenor of the campaigns. i think 25% the new voters,

they'll vote as much against for hillary. a vote counts as a vote regardless. and hillary clinton is no socialist. you know that. >> but the platform -- i think you're counting on her tacking back like her husband did though. where she has moved in terms of, you know, now we got the public option in there. we've got the free college. we've got the $15 minimum wage. all of his stuff except for the vp all of the bernie sanders stuff is in the platform now. so knowing you, you're probably thinking she'll govern from the center. but if you take her at her word and the democrats at their word, this is a bernie sanders platform. >> well, platforms are important. they set a tone. look. i don't think many americans disagree that we should raise the minimum wage substantially. i think many americans believe there should be a public option. you see how successful the medicare expansion has been for medicaid eligible people.

i think most people would agree that's a fair way to go and a way to drive down prices by injecting some competition. so i think those are not revolutionary ideas to have better and stronger regulations over banks and financial institutions. i don't think you can many americans disagreeing with that. so i'm not one for characterizing ideas as ideological. i happen to be a strong supporter of the transpacific partnership. >> there you go. >> and i wrote letters to the congressman as a former chairman, as a former governor saying why i thought trade was terrific for pennsylvania. we tripled our exports in eight years. you're lifting quotas and tariffs on american goods. good lord. 95% of the world's population is outside our borders so we have to be open to trade. we've got to let our services and goods go into those

countries. >> is pennsylvania going to be a swing state this year? polls are converging. >> pennsylvania's definitely in play. there is no question. regardless of the reason, donald trump is appealing to a lot of but collar mostly whites who are either out of work or working in a job that pays them substantially less than they used to. he's making trade the bugaboo. but trade is not the only reason by a long shot that manufacturing in this country is hurt. when i was is kid, i went to the navy yard. we had a hundred with mallets and blowtorches out on the piece of iron. today that's done by four welders sitting at computers operating robotic arms. i think technology has hurt manufacturing more than anything. but donald trump delivers a

simple message that plays into people's angers and frustrations. and that will resonate in parts of pennsylvania. so we're definitely in play. >> ed, we're going to be hearing from michael bloomberg who's going to be speaking soon. i'm just sort of curious. that selection to the business community he is not socialism at all in many ways. but in a world where there's a push for the anti-establishment, the bernie sanders supporters, how does he play in all of this? >> well, i think mike bloomberg is going to talk about both hillary clinton's positions on business and economic growth but he's also going to talk about donald trump's record. and nobody knows business any better than mike bloomberg. nobody knows how you conduct a business properly and do the things that are right for both your company an your shareholders and for the public. so i think he's going to give some tremendous insights into that. then mike bloomberg is going to

talk about the issues he cares about. you know he cares very much about climate change. donald trump has changed his stripes and is almost now a denier on climate change. he's going to talk about -- mike bloomberg's going to talk about guns. good lord, if the last two months haven't convinced us that we have to do something about assault weapons and something about background checks, i don't know what will. and the american people are overwhelmingly behind those issues. so i think mike bloomberg's going to come at it from a number of different perspectives. >> governor, we appreciate it. we wish you a lot of luck over the next couple of days in your home city there. >> thanks very much, guys. appreciate it. when we come back, eli lilly reporting earnings moments ago. the stock is down about 4%, roughly about 3% in the last year. we'll ask ceo john lechleiter

about it. "squawk box" will be right back. with the xfinity tv app,

now you can watch nbc's coverage of the rio olympic games live at home or on the go. eli lilly just out with quarterly earnings. matching estimates. revenue better than expected. joining us now is johnli lik lechleit lechleiter. it's been a quarter since we saw you lost. any milestones we should know

about in terms of new drug development or other corporate news since last time, john? >> well, joe, first of all we're pleased with revenue this quarter. we grew 9%. 8% of that was volume growth. of that 8%, six percentage points came from products we launched in 2016. this is exactly the trajectory we want to be on. the fda did give priority status to a cancer drug for soft tissue sarcoma. this is good news. we hope for regulatory action later this year. we also got approval in japan for our psoriasis drug and arthritis. we're pleased to see that because japan usually doesn't approve new indications like sor yat rik arthritis. so this is a first for us in that important market. >> in terms of how you're

setting up the company for drug pricing in the future, does it matter what politicians decide to do over the next three, four, five years with drug pricing? that's -- we certainly hear a lot of talk about it. is there a specter of something that could be a negative for the industry? >> joe, it does matter. government policy matters a lot. we envision a future where the drug pricing environment is going to be more challenging across the board. however, we're going to continue to stand against major shifts in government reimbursement policy for example medicare part d which a working very well today. all in all, i think we've got to keep in mind drug prices as a percentage of total health care is the same as it was 50 years ago when i was 12 years old. so last year drug prices grew 2.8% on a net price basis. this is not our figure. this comes from ims.

we need to keep this in perspective. because as we all know. medicines keep us well, help us avoid expensive procedures. >> we're hearing a lot about -- in fact, we're just talking about the public option and ed rendell talking about medicaid. the expansion has been positive. there was a notion i think in hillary clinton's plan we do medicare at 50 or 55. now, the drug companies have kind of a foustian deal with medicare. is it good for -- would it be good for you, a company, but would it also be good for cost containment for the entire nation if we lowered it to 55 or 50? medicare? >> well, as you know, medicaid and medicare are very different programs. >> right. talking about medicare. >> i don't have a clear position on whether medicare, the age requirement for medicare should be lowered.

what i can say is today's medicare program with the part d drug benefit which was introduced about ten years ago is working very well for seniors 37 the cost for the drug piece of medicare, joe, is tens or hundreds of billions less than it was forecast to be ten years ago. so, you know, this is a program that's working well today. that's for sure. >> working well for drug companies and for patients. >> i think it's working well for everyone. seniors on the part d plan administered by insurance companies enjoy access to basically the full formulary. >> this is not the affordable care act. >> absolutely. >> so you have no opinion at all on the public option or whether to expand medicare? >> well, you asked me about expansion of medicare.

on the public option, that's something to be looked at very carefully. today many people have called insurance but when you look at their deductibles and copays, many people on these insurance plans today are unable to afford medicines because in essence they've got to pay so much out of pocket. if we're talking about insurance whether it's a public option or under the obamacare law today, we have to make sure it's really insurance and covers people for what they need. >> okay. so if we see you in three mon s months, what are the big milestones in the next three months? anything regulatorywise with the fda for any blockbusters? what's your next blockbuster you're hoping for? >> we've got a drug currently being studied for the treatment of breast cancer. we could file that this quarter depending on the outcome of an

interim analysis of an ongoing breast cancer study. so that's something to look for in the quarter ahead, joe. >> so you did 8% or 9%. you're not factoring out currency. that's what you did without even factoring out the currency, right? >> currency was neg jibl. >> when i'm happy that you're happy, that makes me -- no that makes me happy you're happy that i'm happy. >> i think we need to shut this down. >> all right. thank you. when we come back, it's day one of the fed survey. that's coming up in a couple of minutes. plus earnings expected from caterpillar and 3m. big morning for earnings. look at where the futures are. the dow turned positive about a

half an hour ago. "squawk box" will be right back.

comings up, earnings from caterpillar. plus day one of a two-day fed meeting kicking off today. will the fed pull the trigger

and raise rates in the coming months? the latest results from cnbc's exclusive fed survey. they are next right after the break.

welcome back to "squawk box." among the stories that are front and center at this hour, the toy industry could be on the verge of its best year since 1999. forecast for the research firm npd group, the sales boom beat demand from "star wars" merchandise. boeing is in the middle of a dispute with a supplier. saying boeing is delinquent in tens of millions of dollars affecting its cash flow. boeing is saying they're adjusting to conform to industry norms. after we get through this morning's flood of earnings, two more in the spllt this afternoon. we're going to get numbers from apple and twitter a the closing bell. a lot of people going to be paying attention to those.

>> apple's supposed to sell its 1 billionth iphone this week. >> great for them. but semi-irrelevant. >> 3m. we're going to do 3m. >> okay. >> expectations of $2.07 for 3m. has not traded yet. sales, $7.7 billion would be above expectations. revenue numbers $7.57 billion. so that looks to be above. operating margins, 24%. i don't see any guidance for the future. the street right now for the year is somewhere around $8.24. so this is just a little bit of a beat. here it is. fiscal earnings per share $8.15 to $8.30. that would be basically in line with the $8.24.

caterpillar is also reporting right now. i got to slowly hit this in and then hit the estimate page up. second quarter adjusted net was $1.09. this has not changed yet on my screen. it's changing right now. 96 cents was the estimate. so that's well above for caterpillar at this point. they've got a regular number of 93 but we use the adjusted number. sales, $10.34 billion. that looks like it's below. i don't know if they have something other than sales to add into the revenue number. because that would be below. $78.69 at closing. it is indicated higher. maybe something that goes into -- also goes into that revenue number for caterpillar. other than just equipment sales. >> stock's up 1.5%.

had been in the premarket. it's come down slightly. >> i got $77.46 bid now. big spread on cat pull lar at this point. i'd be surprised. did they really miss by $2 billion on sales? okay. 2016 sales and revenues now at the lower end of the previously guided range of $40 billion to $42 billion. street still well above that. sales and revenue. so now. i don't know. we'll have to see. we just had a better revenue number there. >> $10.34 billion. $10.115 billion is the estimate. >> i got maybe the wrong one on first. anyway, the latest edition of

cnbc fed survey is out. leisman's here but he's standing over there. >> joe. how are you? >> that's a really good backdrop for you. >> it's what they want. so we just do it. >> and you've got a mark you're standing on. >> i have to stay here and i can't put my hand here in the shadow. i have all these restrictions. i don't know if i'm allowed to talk to you. >> you're like the weatherman. >> the viewers have been asking for a full leisman body shot. >> my alternate job is i'd like to do the weather. can i talk about the fed sur vee now? >> oh, that's why you're here. >> big changes. brexit, the brexit -- unexpected brexit vote. dovish comments from chair yellen along with negative interest rates around the world. that combines to for big changes in the outlook for the federal reserve. really a lurch. take a look here.

the prior survey dates are on the bottom there. it had been the next expected hike expected in september. and now go ahead to the next one. it's december. when will the balance sheet decline? that's misleading there. kfs may 2017. now the question is some time after may 2017. look to the right. look at where they're expected to finish. 2.6% had been the quote terminal rate. now come to here. i want to show you this outlook for the funds rate versus the fomc. what you see here is the current rate for this expected to be 3.06%. that gray line there is from our june survey. you can see the fed and the market were closer and now given all these developments they've moved further apart. 1.8%. and now take a look here at what's happened to the projections over the course of a year.

what's significant about this is not they've been wrong. but it's conceptually easing going into the market. if you go back to the prior one, guys, i don't know why you're moving so fast. go back here. come down by 50 basis points this year. and also back by 30 basis points for 2017. here we go. that's what i'm trying to show you. 90 basis points was the outlook for the funds rate this year. now it's here. 50 basis points out from 2017. rob morgan says given the fed's proclivity to keep rates unchanged before a u.s. presidential election, we won't see a rate hike until december at the earliest. kevin james writes in with the survey, the fed seems to be okay with the market being the tail that wags the dog. this is evident with when global growth energy prices and terrorism affect the fed. one of the things we keep hearing is they think the fed will remain on hold but not everybody is so sure. guys saying we ought to be

raising enough now given what's happened with the economy. but they've settled down into this belief that they are going to be very dovish for the remainder of the year. >> steve leisman, thank you very good. >> he thinks they ought to go. and there are many, many people who think the fed ought to be going. but what they're saying what the think the fed will do. not hike until december. you can read all about all the details. but i'll be back at 8:30 with very surprising results about what wall street thinks about this election. big change. big change. >> all right. we'll see you in a little under an hour. steve leisman. coming up, a venture capitalist who has been a long-time clinton supporter will join us after the break to tell us why she would be good for business if she wins the white house. as we head to break, here are some highlights from last night in philadelphia. >> we are not going to be donald

trump's hate-filled america. not now, not ever. >> don't let anyone ever tell you that this country isn't great. that somehow we make to make it great again. because this right now is the greatest country on earth. >> i believe this election is a referendum on who best embodies the leadership we need to go far together. >> hillary clinton must become the next president of the united states.

welcome back to "squawk box." the futures have been narrowly mixed throughout the morning on a day when the fed's two-day meeting kicks off. lots of central bank discussion and focus today as well as the price of oil. the dow, though, has seen a fair share of components reporting this morning. among them, caterpillar which we should take a look at right now. reporting for the most recent quarter $1.09 per share versus 96 cents. revenues $10.34 billion versus

$10.11 billion. the street was pretty much already there but still interesting to see the company take its own expectations for revenue down to 40 to $40.5 billion. that's the low end of the company's prior guidance. >> according to last year, that's the last year they were consistent earning about $12 billion revenue and change. that's a 16% drop in revenue year over year. >> for the quarter. >> yeah. year over year. in revenue. and then for $1.09 which is down from $1.40. the gap was 93 cents down. had some tough times. >> we're going to talk to ceo doug overhelm in just a few. in the meantime, we want to get back to philadelphia where the democrats are quarting to officially nominate hillary

clinton. we are joined now by venture capitalist. he is the founder, managing director. thanks for joining us. >> thanks for having me. >> here's one of the questions. listening to bernie and so many of the people that were at the convention last night, we talked a lot about this idea of being socialism versus capitalism. when you look at where the economy is today, do you think it's left of where you are and left of where the business community is today? >> i think we have to be real is realist realistic. i think hillary contrary to her opponent is known for compromising. i think that's now she got a lot done in the white house. she has certainly burned the edges of her original campaign strategy.

whereas she was in favor of a $12 minimum wage and let the states make various decisions. we're now hearing in the platform. a $15 minimum wage. we'll see how difficult that is to get passed by congress. but clearly the minimum wage is going up. i think that a lot of the things that bernie wanted did, hillary wanted. everybody wants to get rid of citizens united. anyone knows it's going to take another supreme court decision. so it's great to say i'm going to get rid of it. you can't just get rid of it. you have to have a whole legal process. i think there are a whole bunch of things added to the platform -- >> most those are -- i appreciate the sociali issues. where i'm going is the economic piece. how much influence do you think bernie sanders, elizabeth warren and others will have on hillary clinton if she makes it to the white house?

>> that's hard for anyone on the outside to say. i certainly think they're going to have an influence. i think it'd be unrealistic to think it's just be going away. there is common ground. i don't think that the business community has anything to fear from hillary clinton presidency. she is very smart. she understands the issues. i mean, i travelled with her when she was senator all over new york state. something she called jobs for new york. she was so focused on trying to bring economic development, upstate part of new york which is not a simple thing to do. she gets it. and she knows what it takes to raise wages. it's not something you do overnight, but i am totally confident that she's got the economic issues clearly in focus. and i think we'll all be very -- and the other thing is you'll get consistency. the thing that everybody should be worried if they're not is

about donald trump presidency is the absolute inconsistency of every hour. not even every day. and business does not like to operate in an environment where they can't plan for tomorrow. >> allan, i think obviously get a guy like bernie sanders, she's going to get pushed left. she says things like don't let anyone tell you that corporations create jobs or whatever that ridiculous comment was. but on the idea of progressivism, the journal had a piece about the president that even his opponents agree that most of his agenda, he achieved most of it with the largest stimulus package in years. obamacare, nationalized student loans. dodd/frank got a lot of bank regulation, even got the climate change with paris, change labor organizing. all this has happened. all these progressive sort of sacred cows he's been able to achieve. why is the country so miserable?

why are people so unhappy and so convinced we're headed in the wrong direction when he's achieved so much of the progressive agenda? why should we keep going that route? >> joe, i wish i knew the answer. if i knew it, i don't know, maybe i'd be sitting in the white house. i've -- i'm startled by the same issues. i think he's been a great president. i was not supporting him. i supported hillary. and i like what's happening now with the sanders campaign. i moved to the president's being a big supporter of his. i think people -- it comes back to this income inequality. and it's true. a lot of people are hurting. and there are a lot of issues that resonate, you know, who wouldn't want free college education? who wouldn't want getting rid of your college debt? these are things that have bothered, i'm sure the

president. he would love to get to do those things also, but he hasn't been able to. >> you think she'd govern to the right of the president. you think she'd move more to the center than president obama? i think you think that. and looking at what she used to say and her husband and everything else. that's what a lot of people thought. but i guess she's had to fight that progressive flank. she's had to protect that flank. >> you know, i go back -- joe, i don't speak for the party. my sense is you're right. i think they will have to move more to the center. they've already indicated that. but that's not all bad. you know? you've got to get legislation passed. >> i wasn't saying it was bad. >> what? >> i wasn't saying it was bad. i was trying to get you to agree with me it's good. >> it shows an indication to move from one's position and not be polarized and not come out with extreme views that --

hillary, one thing she's absolutely i'm certain, she only will focus on things that actually can get done and is not going to go waste a lot of time with things that aren't achievable. that gives me a lot of confidence. i think it will give the business community a lot of confidence. the entrepreneurial group is certainly not -- they don't get distorted by interest rates. all the things you were talking about, the price of gold, oil prices. most of the people in the entrepreneurial company are financed by equity. that's very much available to stimulate new business formation. >> alan, what did you make of peter thiel's speech last week at the republican national convention in support of donald trump? >> i think peter thiel, he lives in an island in silicon valley. i think if there was a peter thiel meeting, you probably couldn't get ten people out of the whole valley to come. he does not speak for any constituency.

certainly he's in a sea of democrats. but his viewpoint, his negativity -- i heard him a year or two ago speaking in a one-on-one with eric schmidt. all things schmidt talked about with social issues in this country, peter thiel's viewpoints are off the wall in my opinion although he writes a very good book. >> how do you think that manifests itself in terms of his relationships in silicon valley and companies like facebook? >> i -- you know, i'd like to be the fly on the wall with he and mark and cheryl and discussing politics and the populous and what needs to be done to get the country moving forward. not moving again. the country is doing damn well in terms of its recovery of where it was in 2008. people shouldn't forget how deep

we were in a recession, in a critical point. and i think president obama has moved it along. and i'm very excited about what hillary will do. i can't wait, frankly. because i think she's got a lot of good ideas that she can get done. people on the republican side in a way should be looking forward to it because they know we've got someone they could compromise with. perhaps more than president obama has been willing to. >> fair enough. alan, great to see you as always. have fun down in philly. >> great. thanks. >> see you soon. thanks. coming up, you've caught them all. now what? a pokemon king gets a sponsorship. that story up next. and at the top of the hour, the ceo of caterpillar will join us for a first on cnbc interview. his thoughts on the global economy and the company's quarterly results straight ahead. "squawk box" will be right back. (man) what i love most about

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brooklyn resident nick johnson the first person to announce he's collected every pokemon in the popular game pokemon go is about to go on a new adventure. after catching all of the 142 virtual monsters in the wild of north america, marriott rewards has offered to sponsor johnson to go to europe, japan, and

australia to catch the regionally based pokemon and finish his collection. there are several pokemon reportedly only available on those continents. but you may not have to travel so far to complete those. the word is they can be hatched from rare eggs in north america that users can pick up at poke stops. i wonder if his job will let him go around the world to catch the pokemon. it's like quitting your job to go on the bachelor. it's a real commitment. >> how long to do it? >> a week? >> i think we should do a "squawk" pokemon competition. what do you think? >> i want to go on the biggest loser. how long does that take? >> i don't know. >> i think it's about eight weeks. they tape it usually. >> what about "dancing with the stars"? >> you have nothing to lose. >> you'd be like the -- a trainer. >> yeah, yeah. i'd be the guy. do what i say, not what i do. what about dancing? like tucker was going after

one -- >> it's usually 12 weeks. >> you and mark cuban. he's done that. >> i'm not going to dance. would you ever do that? you might get asked. >> i probably would not. i probably would not. i'm not much of a dancer. >> big profile though. >> not much of a dancer. >> what about just, like, that kind of dancing you do, don't you? >> terribly. >> alcohol-related. that's the only way i can even think about it. anyway, we probably got to -- >> we got to go. >> what if billie jean comes on? >> you know, i got -- i just tap my finger. >> like in and out like kevin klein. coming up, caterpillar's ceo is going to join us on the state of results. and later we'll get reaction tonight one of the democratic national convention with former white house chief of staff. bill d bill daley will join us. "squawk box" will return.

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earnings parade. a flood of companies rolling out results including caterpillar. a first on cnbc interview with ceo doug oberhelman straight ahead. a call for unity in the city of brotherly love.

some bernie or bust delegates are not going quietly. we'll tell you what to expect from day two of the democratic national convention coming up. aerial amazon. teaming up with the uk government to take to the skies. the final hour of "squawk box" begins right now. ♪ live from the most powerful city in the world, new york, this is "squawk box." >> all right. welcome back to "squawk box." bring you this news right away. first on cnbc. mcdonald's earning i think $1.45 a share. the nominal number the company gave was $1.25. it includes strategic charges totaling 20 cents a share. which if you add those back in it'd be $1.45 which would be above expectations. the stock is down i think on the

weakness in the comps. >> global comps, 3.1%. the street had been looking for 3.6%. in the u.s., the street was expecting 3.4% and that came in at just 1.8%. >> that's the fly in the ointment right there. the revenue number was fine as you see on the screen right now. mcdonald's focused on meeting the customers' needs for high quality affordable food and beverages. the second quarter performance which marks our fourth consecutive quarter of positive comp sales across all business segments provides a clear indication that customers are responding to the steps that we're taking to deliver them value and convenience. we're making steady progress. as we mentioned, it comes in at 90. so it's traded at a series of new highs. we're talking about a 2% drop today. company says returned $4.1

billion to shareholders and they go on to give a cumulative number of $24.4 billion returned versus a $30 billion target for the three-year period ending in 2016. >> they do talk about continued momentum from all-daybreak fast, the pick two menu not being strong. >> from the u.s. comps, aren't they under there? >> well, they're below expectations. >> so are global comps. global comps are 50 basis -- it's 3.1%. >> the u.s. is the issue. the u.s. is the thing that people are going to feed off of. >> that was better than expected. supposed to be 6.2 but certainly not enough to out shine the u.s. supposed to be 3.4% and it was 1.8%. >> but you got to add -- there it is. we got it now. >> stock's down.

let's take a look at what that's done for futures. we've had a slew of components reporting. now we have nasdaq ticking to positive territory, the dow is now slightly lower into negative territory and implied open at this hour. a number of other dow components out with numbers this hour. 3m, revenue in a bit short. also lowering its guidance and narrowing full year earnings view. also verizon beating the street on the bottom line. revenues just a bit shy, however. and dupont earnings and revenue benefitting from improving margins. the company now raising its forecast. then ut, united technologies, posted better than expected earnings and revenue. you don't want to miss the ceo greg hayes. that's going to happen in the next hour around 9:50 a.m. caterpillar reporting earnings and revenue ahead of

estimates. but the shares are under a bit of pressure. joining us now on cnbc, doug oberhelman, ceo of caterpillar. good to see you. i'm waiting for -- you're going to be like, hitting your head against a wall. and one day you'll stop and feel good. we report on it every day. but you've been navigating through this difficult global environment for equipment and everything else. for two or three years already now, isn't it? >> well, it's our fourth year and we've been navigating pretty well with the hand we've been dealt. but you're right, it's been a challenging period. what i'm most proud of is the way our people are responding. the way we're getting after cost structure and restructuring and getting through this in a way we never have in prior downturns. i'd happy with that. and when it comes, why shout? we would post up good numbers at that point when it comes. >> i mean, you've taken all the

steps that you can in terms of expenses and maybe layoffs and pulling back on certain parts of your business. is that done? is it completed at this point? are you lean and mean as you're going to get? >> we're lean and mean now, but we're going to get a little leaner and meaner before it's done with. that's one reason we took our look down a little bit in the second half. for more restructuring to come in 2017 and beyond. but we're looking at a very strong balance sheet pretty good cash flow in the first half of the year. we're on solid ground here with market position around the world. doing internally and operationally very good. our safety numbers, our employees are better than ever in history. so all in all internally our operational metrics are good. we just need some market cooperation. when it comes, we'll all feel much better about it. >> what does that mean? what would you like?

there's some -- i'm looking at the tappan zee. you talk about infrastructure. that's the kind of infrastructure you probably like. we got a bridge going up there. it's like, you don't see that very often anymore. that's like building a dam or something. it is amazing. is that what you want infrastructure? or do you want a rebound in oil prices? or do you want rebound for your mining operations? what sit you need? >> we'd like it all, joe. sooner the better. but right now there's a lot of infrastructure building going on, it's just not the rate we've seen and the rate we need to kind of rebuild what is in this country and around the world. that will come down the road. a lot of the topics surround how we get the economy growing again as infrastructure is creating good jobs out there. i will tell you, there's a lot of that going on around the country, a lot of states have passed bond issues or tax increases to fund infrastructure. slowly building the five-year highway program that was passed last year.

it was really a positive. i think as i've said before, that's more of a 2017 event. we're seeing some of that around the world as well. china actually for us is a little bit better continuing on this year. it's not a big boom. but that infrastructure, that mini program we put in place, we've seen that as well. i'm optimistic that will come down the road as well. >> doug, we know you would also be in favor of the transpacific partnership coming to fruition at some point this year. how do you operate a business in all of those countries without knowing whether the rhetoric of our current political environment from both the republican and the democratic candidates is against that? >> well, here's the important thing for me. if you can see behind me, i've got two machines. i'm sitting out here in the dirt in our edwards training center. the one on the right behind me is a machine that's built in texas. the one of the left is our biggest bulldozer built here in illinois. both of those are big export models. in fact, where the big bulldozer

is made, the vast majority of production in that is export. that means the jobs are export related. if we don't have exports and can't trade with our partners somewhere around the world, guess what happens to those jobs. that's why i'm so vehemently in favor of trade. i can't believe what's happened with the trade environment around the world lately. nafta's been good for this country. it's been good for our trading partners. we've all benefitted from that. it's a hard argument right now in this environment, but it's true when you get down to the shop floor and so much of those bulldozers and those excavators are exported outside the united states. we've got to have those markets. again, we're 5% of the world's population. and the rest of the world is growing faster than we are. so we've got to find a way to do this in a trade -- go ahead. >> given the political climate, do you have any expectation that either party is going to be helpful to you over the next four to eight years? or do you think we've moved in

such a direction that -- >> well -- i -- no, it's not a lost cause. look. business is a driver of this country. we will work with anybody however it works out. in the end, it comes down to economic growth and how do we stimulate from a 2% growth to where we are today to something higher. certainly tax reform is some after that. all that plays into that. i think reality will return and what we need to do after the hype of all the election season is over. >> so you need mining to get better. and you also mentioned rail. what's going to make rail better? coal's not coming back, is it? i would think auto sales helped there and housing probably helps with rail too. what's holding that back for you? >> certainly the oil price has impacted that somewhat. overall a generally slow economy has impacted real freight and freight moving across the country. so we come right back to that 2%

growth rate. if that bumps up, we see a lot of things happen quickly. so that's really the basis of a lot of this. >> how many more -- what percentage of the workforce still needs to go and what will that bring the total to over the past four years? >> well, we finished our total workforce at about 112,000 people. and that's down over 30,000 from the peak 35,000 from the peak in 2012. and i always talk about that with kind of the impact on our people. those are 30,000 families that are impacted. >> how many more? >> that's really a lot of what's happening when it comes in. i'm not going to comment how many more. we'll do more tweaking here the end of this year. >> all those in mining and in oil and gas and all those. >> well, mostly i would say in mining as we tweak that business to come in line with what we

think the long-term future will be. but there'll be some of it across the world. but most of that will occur in mining. >> we're good at getting these things. you wouldn't have these prices in all these raw materials if we were running out, would you? better and better at getting extracting it. do we need to go to asteroids? i don't think so. >> no. there's still a lot of ore of all kinds being mined around the world. what we've seen is the expansion of that because of the overcapacity slowdown. look. the world is going from 7 billion to 9 billion. we know what those people are going to need as the population grows. mining fundamentally long-term is a great business. we're just in this really tough period right now where there's an overcapacity that needs to be worked through. but long-term we think it's a good one to be in. quite happy with the outlook of that down the road. >> you know, 2%. just say that over and over again.

when anybody asks you anything about caterpillar, that's all you need to say. 2%. we need 3%, 3.5%. >> you're right. and at 3% economic growth whether it's the united states or world, that's what drives employment for us. short of that, we niend ourselves trying to get through it restructuring doing things to get that done. but it's really a 3% economy that adds jobs in a good way. good manufacturing jobs around the world. and as soon as we get there, we'll see it. and it'll happen down the road. no question in my mind. >> i believe that too. but we have been -- i don't know. who is it that tells us we can't do it anymore? it's the people that are responsible for why we're here now are the ones telling us we've got to get used to this and we can't go back to 3%. that's not true, i don't think. >> is i don't accept that either. there are structural things in our economy that can and will need to be changed like tax and

some of the other things that we've got to get around. we get some of that, i think we could see that move up fairly quickly. we do need to get after it. i think that's commonly understood. how we do it is another question. >> that might be why these people are right. because we never do get to it. maybe we are stuck at 2%. but i don't think by definition our potential is not just 2%. but we may bring it on ourselves. >> no, it's not. >> well above that. >> no, when everybody talks about things will never change, i get worried. when oil was at $140, people were saying it'll never change. when people say never changes from 2%, it always does. >> if that'll help, if you recognize that i'm throwing in the towel. we're never getting back to it. maybe that'll help. thank you. >> don't throw in the towel. hang in there. >> throw it in pip give up. thanks.

we'll see you in three months. among today's other stocks to watch, under armour earnings in line with estimates. the bottom line showing a 28% improvement from a year earlier. that's due to greater demand for apparel and basketball shoe. the stock is down just slightly in premarket trading. eli lilly's profit matching forecasts. revenue better than expected. lilly's results were helped by demand in treatments. and ceo of lilly joined us last hour to discuss. >> first of all, we're pleased with revenue this quarter. we grew 9%. 8% of that was volume growth. of that 8%, 6 percentage points came from new products we launched since 2014. this is exactly the trajectory we want to be on. >> the company also saying it's committed to annual dividend increases as well. take a look at gilead sciences. lowering its full year outlook on slower than expected sales of its key hepatitis c drug.

shares are sliding in the premarket. when we return, shares of mcdonald's falling after results. we'll speak to an analyst after this. ♪ [announcer] is it a force of nature? or a sales event? the summer of audi sales event is here. get up to a $5,000 bonus on select audi models.

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amazon's taking to the skies. the e-commerce giant entering into a partnership with the british government to explore drone deliveries. the firm has outlined plans to begin using drones for deliveries by 2017. and it's working with britain's aviation regulator. an important sign of confidence in britain after its vote to leave the european union. meanwhile mcdonald's out with quarter results. a gap number of $1.25 per share and adjusted number which included some strategic expenses of $1.45 per share. the u.s. comp store sales were short of estimates up by a wide margin. calling in now to the news line is rj hottovy.

quickly talk about the eps number. which one are you using and why is that? >> yeah, we'll be using the adjusted number. we'll strip out some of the refranchising, other strategic actions. those are really something that i think will taper down over the next couple years. i think the $1.45 number is the best to look at here. >> revenue was pretty much exactly in line. but it's the comps that are as joe called them earlier the fly in the ointment. u.s. was close to half of what the street was expecting. what happened? >> yeah. that's number we're focused on right now too. it's clear that the restaurant traffic that a lot of mcdonald's peers last week had talked about industrywide slowing and traffic. it appears mcdonald's isn't immune to that phenomenon. that puts the company in a tough situation. just with the spread, with food at home prices versus restaurant prices being pretty wide right

now. also in tough situation in terms of costs. we could be entering a situation of more advanced margin compression the back half of the year. >> it's hard to call these growing pains for a company that has $100 million market cap. but it does feel like after four quarters of this comp expansion that there is some steam coming out. is this worrisome to you? or do you think this is just a hiccup? >> i think it's interesting. i think if you look compared to a year ago, i think the company's in a much better place. i think steve has realigned the business and made is much more nimble organization. as significant as to replace it. there are some new additions to that. they are testing some other premium products, adding new things to all-daybreak fast. there's nothing as significant as that when you combine with slowing industry sales.

back at the u.s. market. particularly on the big numbers from a year ago. >> is steve easterbrook still in the phase of what works on this menu of 2016 and what price those items should be? >> yeah, i think that's still the thing the company's grappling with. i think they've had success in the pick two platform. but i think they're still trying to figure out what works. it may be more than expected to grapple with including the others starting to pick up there as well. i think they're still trying to figure out what works for the customer in this environment. >> of course steve easterbrook has been positive for the stock. it's up 30% in the last year. today's drop that we'll wait and see if this actually comes to bear in the actual market open, but it's down about three and change percent in the premarket.

do you view this as profit taking or broader selling? >> i think it's broader selling. i think people are taking a more bearish stance given now this is the third or fourth straight earnings report from the industry that outlines this negative traffic. expect it to continue over the rest of the reporting season. i think this is general selling. we'll take a look at e the numbers when we get through the conference call today. potentially looking at a minor reduction in our estimates as well here. >> and we'll look for those headlines as they come out of the call. rj, we appreciate your time. >> thank you. coming up when we return, wildfires raging in california forcing thousands of people out of their homes. we've got the pictures and the prospects for getting the situation under control when "squawk" returns in just a moment.

welcome back to "squawk box." take a look at futures right now. we have seven dow components reporting this week. a handful are out just this morning. the dow is current i will down just about eight points. it's been in narrowly negative territory. but the nasdaq would imply an open of being positive about three points. oil prices have been in focus all week. wti down 1.3%. brent losing close to 1%.

of course that's coming after losses yesterday where crude lost about 2.5% and we close at the lowest levels since late april. wildfires in california have tripled in size. they've engulfed another 10,000 acres going beyond 33,000. 3,000 fighters are battling that blaze. a set used for tv shows over the last 50 years burned. mcdonald's is good for 30 points or so, right? something's offsetting the mcdonald's shares going down. when we return, this morning's top stories. plus it's day two of the democratic national convention. that's kicking off after a rough night for bernie or bust delegates. former white house chief of staff bill daley will join us live from philadelphia. and we'll ask him about the

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welcome back to "squawk box." stocks to watch this morning on our list, starbucks was added to the america's conviction list at goldman sachs. which expects comp store sales to reaccelerate. reynolds american raised above estimates. the tuberculosis producers revenue did miss forecasts. also narrowed its 2016 earnings guidance. it also raised dividend by 9.5% to 46 cents per share. bp citing weaker oil prices and margins for refining. bp also cut its capital spending budget. donald trump getting a boost in the polls a the republican national convention. but does wall street agree? steve leisman joins us now with kind of surprising results from cnbc's exclusive fed survey. >> yeah. pretty big change in the outlook

for wall street for the election. we've been asking this for several months now. 43 economists, analysts, managers polled here. let me set up what's going on here. first we ask a generic question. what's the best election outcome for the economy? democrat wins or republican wins. and we start with don't know and doesn't matter. you can see it's come down. little bit more conviction happening. where does it go? well, more people think it's a better outcome for republicans to win. a few more for democrats. much of the don't know goes over to republicans. first of all, i want to show you this remains the same. the impact of the election, 60% of our respondents think it's negative for the economy. the overall tone of this election here. but now that sets up the big change in the outcome or the outlook here. and that is in the next screen here, if we could get there that would be wonderful. there we go. previously 80% on wall street thought clinton was going to win this election.

hillary clinton the democratic presidential nominee or soon to be, i suppose. that was 80% before. that's now come down to 52%. not a whole lot of conviction that donald trump is most likely to win. but more than last time and a lot more saying they don't know about how this thing is going to play out. so that's a big change. from 80% thinking clinton was going to win now down to 52%. this coming in the wake of the e-mail scandals and of course the republican national convention. we'll see what happens post-the dnc here. now, what about on the issues themselves? very interesting results here. first of all, who is best for the stock market? hillary clinton continues to enjoy a lead here, but donald trump has narrowed that. i think that lead for hillary clinton comes mostly from a sense of stability that wall street expects from hillary clinton's policies more so than perhaps donald trump. but again that he went to 31% with a big contingent saying they don't know. donald trump continues to enjoy the lead here. 44% versus 32%. virtually unchanged since june.

in general, guys, what we see here is uncertainty over the election, a sense that it's -- the whole tone of it is negative for the outcome. but a change here in the sense that they thought clinton was going to walk away with this. and now they're a little bit more unsure. joe? >> i don't know why the stock market and better for the economy don't sync up. >> i think it's a question -- you know, whatever policies hillary clinton is going to come up with, i think there's a sense on wall street that they're more in line with what was in the past a kind of status quo. and whatever the situation, wall street doesn't like change. i think you know that. >> wall street would like a 3% economy. i mean, if it's better for the economy -- >> fair enough. >> you know what? maybe they like her for the stock market because she's shown -- she was really good with commodities. so maybe it has to do with just -- >> it could be that. but i also think that you have a lot of concern in the commentary

that i didn't show you about tariffs and protectionism for trump. >> you know why i said that, steve? i said that because i think my friend bill daley has an ifb in his ear and i said it for his benefit. to bring up cattle futures. see, there he is. he's nodding. anyway, thanks, steve. let's get to bill. joining us now is bill daley. served as president obama's chief of staff and is also a former u.s. commerce secretary. that was for your benefit, bill. i thought you'd chuckle. >> i figured that, joe. i thought that was. >> you're a businessman. you've been in business. we're hearing a strange move from people backing hillary that are business people. that is don't believe the move to the left that you've seen because of bernie sanders. she's going to govern like her husband, more from the center.

and business people should take solace in that. someone who appreciates a private sector. i think you make that case too, right? >> i don't question that. on the other hand, let me just be honest with you. i think there's an acknowledgment that the public has -- the electorate has moved what simplistically speaking to the left than they were years ago maybe as a result of the '08 recession and the lingering effects of that. a whole bunch of things that are out there. i don't think we can be as simplistic as saying one box or another one she's going to fall into. there's no doubt as steve was going through some of these numbers. as you know, joe, historically if you look at the economy under democrat and republican presidents, the economy usually does better. not talking about the stock market all the time, but the economy usually does better when a democratic president is in

office. >> takes four years to screw things up. and then, you know, the republicans got to come in and fix it half the time. you know, you grow the size of government. you put all the regulations in. >> put people to work. remember reagan followed carter. and obama followed bush when the economy was losing 750,000 jobs a month. we had the worst recession since the depression. and -- >> we all share the blame for some of that. >> absolutely. i agree with that. >> and maybe alan greenspan and co share in that. >> who appointed him the first time? >> it was reagan, i guess. >> he had a good run. he was on the cover of "time." >> thank you. >> here's one of the things that gets me, bill.

when hillary said don't let anyone tell you that corporations create jobs. that was just -- she just misspoke or something? or that was -- >> yeah. look. i think it obviously is not accurate. corporations, the private sector whether you're a large corporation or small, creates the jobs. the government may set the tone for greater job creation or less job creation. but it's the private sector. the government's got a lot of jobs, obviously. >> so she knows that. her husband's seen that. she knows that. >> absolutely. look at her history. you know, the idea -- she's getting beat up right now in this convention by many people and did in the primary for being too moderate and not far left enough. she's practical. but i think you have to acknowledge that on so many issues, who would think both parties have moved where they have on certain issues? do republicans reinstate

glass/steagall, donald trump did beating up corporate america. >> in agreement on tpp. the nice bipartisan rejection of tpp. >> i like ed rendell think it's a mistake. i just got back from asia. and there's no doubt that if isn't a greater economic closeness between our neighbors, china will step into that void. it's very important. i think the president was right. is it a perfect deal? no, it isn't. to blame all of the job loss of the last 30 or 40 years on nafta and trade deals is kind of crazy, in my opinion. and when you look at the technology advances created by u.s. companies, created by u.s. workers and innovators over the last number of years, they probably have put more people, changed the job structure, changed the economy and created more unemployment in many ways

or new employment than any trade deal ever did. >> you're smart. you understand there's supply side remedies. there's progressive remedies. we have been through -- we've done a lot -- the journal points out the president got a lot of his agenda through. and, you know, a lot of things have changed in the past eight years. obamacare or, you know, big stimulus package. we've tried a lot of that stuff. you would, i guess, just knowing that you'll have an answer for this. you would say because the recession was so deep in '08, this is part of the residual effect of that. i'm talking about the 70%, 80% saying we're in the wrong direction. the journal points out how miserable we are. he got everything he wanted progressivewise. maybe progressive policies aren't the things that the country needs to grow. >> well, i don't think that -- first of all, i think that the

president got everything he wanted when you considered the congress changed in 2010 was a little unrealistic. he did get some things done. which were early in the first two years. but the fact of the matter is the economy is stronger. there has been improvement. but we've had this right way/wrong way in polling about where the country is going for quite a long time. i don't think it's just about the economy. i think it's a deeper, broader question which is frightening in our form of democracy, in my opinion. so i think it is very difficult for whoever is the next president. and i believe it will be hillary clinton to govern with this sort of attitude and concern about our future that's there. some of it unfounded. again, if you look at the economy, yes, we're not growing anywhere near what we have to. and that's the biggest problem or the biggest thing that has to be turned. but when you look at the rest of the world, we are doing awfully well compared to most of the

world. >> we're not doing well compared to china. we've always outgrown europe for the past 40 years by 40%. but some people think -- >> but china's having their own problems as they mature. they were when you have a billion people. that's a real thing. >> we got to bet back to 3%. >> absolutely. it will be hard, joe. it will be hard. >> it's morning in america. always. >> but it's not the apocalypse. >> not yet. >> we're a long way from that. you know that, joe. >> i know that there are some serious issues that would be here by growth. a lot of issues that would be cured by 3%. i can't think of any that aren't

cured by that. the income inequality, pension problems, our employment problems, our participation rate. you put 3% on there -- >> they won't solve it, a 3% growth. >> it would be a lot better. >> it would be a lot better. >> and you know how to do that. the remedies that we're not seeing any of that in the democratic platform spp corporate tax reform in the platform? or just $15 this, give away this, give away college, give away child care. >> joe. i don't know about you, but the only time anybody ever talks about platforms is for four days every four years in either city where the republican and democratic convention is held. the leadership of the congress whether democratic or republican does not take that for the model of governing. so i know we get all ginned up about it, but the reality is that may be a statement about the goals of the party. >> we got to run.

>> that isn't always the president. >> when i watch golf, i hear does this guy boo weekly. when people hit and they go boo, and it's a good thing. is that what i'm hearing when they mention hillary? is that now a good thing? the boos? is that now a positive when cheering like that? >> it's really not a boo. it's a lower sort of -- >> it's a you go girl. >> you got it. >> all right. i was just confused. >> all right, joe. i just want to straighten you out on that. you're misinterpreting what people are saying. >> okay. thanks, bill. coming up when we return, we can talk big labor taking center stage making the case for hillary clinton. mary kay henry is going to join us live from the convention after her speech last night. we're back in just a moment. hey look, it's those guys.

[music] shawn: look at those pearly whites, man. [music] bud: whoa, cute! shawn: shut-up. jess: are you good to drive? shawn: i'm fine. [music] [police siren] jess: how many did you have? shawn: i should be fine. jess: you should be? officer: sir, go ahead and step out of the vehicle for me. shawn: yes, sir.

bud: see ya, buddy. today, shawn's got a hearing, we'll see how it goes. good luck! so, it turns out buzzed driving and drunk driving, they're the same thing and it costs around $10,000. so not worth it.

national union leaders making the case for hillary clinton in philadelphia. joining us right now is mary kay henry. she spoke at the convention last night. joins us this morning from philly. good morning to you. >> good morning. >> so help us with this. i was reading something that you wrote. you said. this is back in january talking about donald trump and what he was doing, how he was playing to the very anxieties of the people that you represented. and the question that i have is given how successful he's been

at that, how do you ultimately turn that tide given that you're supporting hillary clinton? >> we think it's through building a movement of millions of people that are in the streets fighting for 15 in the union. fast food workers, child care workers, they've seen over the last three years by joining together that 20 million people have more money in their pockets through minimum wage increases, through companies like google and facebook and nationwide insurance deciding to raise their minimums to $15. that is helping people understand that they can address their deep economic anxiety by joining together and fighting for candidates like hillary clinton who is going to make sure we raise wages and create good jobs in this country all across the service sector. >> how much of this is about the metrics and minimum wij unto itself and how much is about a deep seeded anxiety among so many workers to the extent you

believe the american dream is challenged, that it is and is not going to get better? and that's what -- and that's where donald trump is winning. >> yeah. those two things aren't separated. people's deep fears are being addressed by the hope and inspiration they find in being able to join together and raise wages and create good jobs. and that's what we think is going to trump fear in this election is love and hope that when we join together, we can change our lives, our family's lives, and our community's lives. and we've experienced that already. and we're going to add to the momentum by knocking on doors in latino and african-american and api communities and making sure we turn out a vote for hillary clinton and champions up and down this ballot that are determined to get this country moving in the right direction and creating more good jobs so people can work hard for a living and actually feed their children. >> you were in the room last night. how divided is that room?

and i say that reflecting upon when elizabeth warren came to the stage, there were chants of "we trusted you." past tense. >> you know, i have to tell you, i was on the floor for two hours and the overwhelming feeling i had in that room was inspiration about what's possible for us when we join together and incredible understanding that we are facing the most consequential election of our lifetimes. there was lots of energy in certain pockets of the room that i think cameras focused on. but i have to tell you, if you just walked the floor and sat in delegations, there's huge developing unity and inspiration about what's at stake and how we need to join together like never before to make sure our country is able to be its best self and create good jobs, put more money in people's pockets so we can get the economy growing from the inside out again. >> let me ask you another question, one we've been batting around all morning.

which is there's a sense that hillary clinton plans -- or there's a view within the business community that she is going to govern from e the middle. and yet clearly the party has moved to left. how much influence do you think bernie sanders and elizabeth mi. how much will elizabeth warren and bernie sanders have in terms of sway not during the election, but in terms of policy afterwards if she were to win. >> wing the biggest thing that sways senator elizabeth warren, and bernie sanders, are when people join together and decide to organize on a scale we've witnessed for fight for 15 in a union and movements where our elected officials from every party have to respond to what people know is right. it's not right to be able to work three jobs and not be able to feed your family. it is wrong and people are in the streets making that case each and every day and every government official has to respond to the demand for 15 in a union. and that's the thing that'll move the country.

>> okay. we're going to leave it there mary kay henry, we really appreciate you joining us this morning. >> thank you. >> thank you. jim crimamer joins us live from the new york stock kpang. lambert down less than ten points, down 6 on the dow, and unchanged on the s&p. be right back.

let's get down to the new york stock exchange. jim cramer joins us now. i didn't hear you talk about it, jim, but if oil goes down below 40 again, are we back in the soup, worried about what oil does every day, every tick? >> so far, both the oil and dollar have had no impact on this quarter, but i think below 40 would because you're beginning to start thinking, wait, is there a demand side problem. we haven't had the demand-side worries in a long time, but the baltic freight index has been going down. copper is kind of treading water. you don't want to see this. we heard doug from caterpillar speak. you absolutely need oil to not go below too much because oil is a huge driver of capital expenditures and we heard from that slumber jay.

this is not what's happening in q3 and 4. >> 45 to 50 was -- it was like goldie -- it was just right. >> exactly right. >> now we're below the midpoint to 40 to 45, to 40 and if we get a three handle -- brexit was fine. market went straight up after brexit, but put oil below 40 again, that's going to get people talking about growth again globally. >> people relate oil to is world growth, united states growth, but latin american growth, europe, china. and it was ordered during this whole period since the bottom in late january, it was ordered as the reason why we can take recession off the table and i do think when i listen to steve liesman, i hope the fed doesn't do anything or do anything too negati negative, meaning the economy is too low, and negative scenario for the bulls. >> if gas is too cheap for

consumers, why aren't they buying as many hamburgers from mcdonalds? >> there isn't a single thing in this country directed to gasoli gasoline. >> what do you make of the comps in mcdonalds? >> there's a lot of hype in the last -- in the last i'd say six weeks we got word these numbers weren't going to be that good. stocks went up on pokèmon japan. as a peak restaurant we have two different restaurants. i don't know, i think that's a very hard call. this calls for recession. in a recession you eat more burgers at mcdonalds. the last quarter was not sustainable and that's what we're finding out now. >> yeah, i don't know why, i eat there. that's not me. that's not what happened in those comps, jim. any way, thanks, pal. we'll see you. coming up this morning stocks to watch and then in the next hour don't miss the ceo of

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street estimates, and offered a strong outlook on an increase in demand. we've certainly had quite an earnings parade throughout the morning. mixed results, i would say, for most of them, but texas instruments out performing close to 8%. >> that's at least a 12 month high. i don't know if it's 52-week -- or all time. >> make sure you join us tomorrow. "squawk on the street" begins right now. good tuesday morning, welcome to "squawk on the street," i'm carl quintanilla, jim cramer, david faber at the new york stock exchange. the earnings parade is fast and furious, with cat, verizon, mcdonalds. add to that day one of a two day fed meeting. the dnc last night, futures relatively steady. europe is mixed this morning. another terror attack in northern france to watch. oil is lower as more reports suggest