good morning. welcome to "squawk box" on cnbc. i'm becky quick. let's get to today's top story. the bank of japan rebooting its monetary policy. the boj didn't cut interest rates further into negative territory. they did not expand the asset purchases as some figured they might. instead the bank is abandoning its base money target and introducing a ten-year interest rate target. this is a whole new game. that's not something i saw people expecting. the goal is to stoke inflation, that's the opposite of what you usually expect a central bank to be doing. the boj will buy long-term government bonds to try to keep the ten-year rate around zero. the japanese ten-year yield briefly, briefly rose above zero for the first time since march. right now it's down just below that again. down about 0.2%.

if you look at the yen, to see how the markets are focusing up on all this, the dollar/yen looks like it's sitting at 101.52. the nikkei up by about 2% on this. a lot of options that the bank of japan had. this is not one of the four major ones people were anticipating. >> a bit of a head scratcher. jim can make make sense of it later on. i was listening to "worldwide exchange" driving in. it's a little wonky. just trying to fix ten-year bond yields, but probably all about the yen. i don't know what to make of it. >> here's the thing. this is the "wall street journal" saying yesterday stocks moved up based on it. the dow edged up as investors awaited policy decisions. >> the bank of japan is the big -- >> the bank of japan, for the hard core investors, this is the game. >> i will say, jim can clear some of this up, by not easing

further, by not luring interest rates one more time, by saying they won't buy more in bonds, that may give our federal reserve room in terms of going ahead and pushing rates higher. it's been a huge part of what's holding them back, not wanting to be the only one moving in the opposite direction of the central bank. >> so basically mom's 401(k) and 529 plan are driven by stock investor here's here, which is by the fed, which is driven by the bank of japan? >> sort of. >> so if we go higher at the end of the year, i urge everyone to send an e-mail to kuroda. thank you very much. >> the federal vooreserve and jt yellen taking central stage

today at 2:00 p.m. eastern. that's followed by a news conference. we will be parsing the language for any hint that the rate hike may be coming at the december meeting. power lunch will have full coverage of that decision and follow up. the show begins at 1:00 p.m. eastern. hosts are nice. futures indicating some optimism. european markets across the board are higher. all the major indices, germany, italy, france, spain, all up by 1%. driving that may be crude oil. crude oil has been volatile lately, but this morning up 2.13%. rbob, gasoline futures, up about 2.5%. >> a couple corporate stories to tell you about. samsung saying that more than

500 replacement galaxy replacement note phones have been shipped to stores in the u.s. and will be available starting today. the company recalled 2.5 million phones due to a malfunction that causes the battery to overheat, catch fire and explode. apple now spending more to make that new iphone 7 than it did on the iphone 6s, due to knew features such as bigger battery, larger storage capacity. this is coming from a tear down by ihs market, finds the total cost to manufacturer the iphone 7, $235. still a healthy margin. the estimated cost is similar to rival phones made by samsung but apple commands better margins. finally a little bit of earnings news. fedex beating the street and

raising full-year guidance, it sees its income rising for the year despite its acquisition of tnt express, which has weighed on the bottom earnings. revenue of $14.66 billion beating expectations. the shipping giant citing strong revenue in express ground and freight business units. fedex offering an upbeat assessment for holidays saying they will benefit from e-commerce transactions. the question is how much of a signal this is about the rest of the retail market and the world. so much as it is about the fact that i think they cleaned up a bit of their operations. they got more efficient. >> ceos under fire in washington. this was the reception for wells fargo ceo john stumpf yesterday on the hill. >> you should resign. you should give back the money you took while the scam was going on. you should be criminally

investigate investigated. >> mylan's ceo seat later on. heather bresch will be talking about the epipen price hikes. meg terrell has more. >> reporter: heather bresch will testify in front of the house oversight committee today at 2:00 p.m. we'll be at that hearing covering it. she is going to be asked about the rising cost of the epipen, the price for a two pack has risen to more than $600 from less than $100 a decade ago. in her prepared testimony bresch is sort of expected to break out what the cost of the epipen s sort of what she did with you a couple weeks ago. they say after rebates and the cost of goods, the total profit is $100, or just $50 per pen. she says in her testimony that price and access exist in balance and we believe we struck that balance. also going through a lot of the

access programs they laid out to help patients pay for the drugs. they says looking back i wish we had better anticipated the magnitude and acceleration of financial issues for the growing minority of patients who may have paid the full wholesale acquisition costs and more. about that price and decisions on who raised the price and why. they will be facing questions about their epipens for schools price, and classification under medicaid. many states claim that mylan misclassified the epipen to pay a lower generic rebate. heather bresch not the only one testifying, there will be someone from the fda, but most eyes on heather bresch. >> did they watch yesterday? was there a lesson in what happened yesterday? >> you know, i didn't ask mylan

whether they watched yesterday. i assume they have been. elizabeth warren will not be on this committee asking questions, i'm sure she's following the situation closely. >> this is a different situation, too, because her own connections with people on the hill, her father is a senator from west virginia. the lead story in "usa today" talks about how her mother used her post to try to push epipens into schools, 11 states, then later signed on and said the epipen is what you had to have in schools through the nurse's office. raises all kinds of questions. i wonder how that will play out on the hill today, too. >> will be very interesting. mylan having so many connections with the government and important connections for them. these legislative actions have been helpful in increasing awareness of the epipen, getting them into schools, also stocked on airplanes. mylan argues this legislation is

important for awareness of an anaphylax anaphylaxis. but it also boosted the bottom line. >> when she did that interview with you and came up with a number of new programs to get to people, epipens for cheaper prices, that seems different than the accountability that we saw from john stumpf. totally different scenarios. we'll see how much of a grilling it is. i thought yesterday was brutal. >> both with wells fargo and this situation, you're dealing with direct contact with consumers who are hit hard by this. consumers are paying more out of pocket now than a few years ago. raising prices in that scenario looks like it was tone deaf. i'm sure they would take back some of these things. >> i have not spoken with them, but i assume what we'll hear today -- this is important for investors, too -- we'll probably

hear more of what we heard in the interview, which is we're not making 600 an epipen. that everybody is taking a bigger chunk. watch the pharmacy benefit managers, the cvx, express scripts. we'll hear how much they're taking. and insurance companies, as heather tried to lay out, the insurance companies are taking more. mylan raised the price, but everybody is taking a bigger cut. >> let me ask, what confused me is their contention that they only make $50 per epipen. >> after costs, after everybody takes a chunk. >> they're now offering a $300 rebate. are they taking a $250 loss on every pen they're giving away? >> no, i believe some of that is subsidized. i don't know who is eligibility for the rebates. i'm not sure anybody does. i had some people write me saying they applied for rebates and were rejected. >> we talk about is this political theater but does this

mean the regulators across the board -- yesterday, that's what happened with wells, that's the issue. >> it's much tougher regulation on every player. >> i guess -- >> or does the regulation go across the board? when you hear elizabeth warren call for vast criminal investigations, that changes the game completely if, in fact then regulators -- >> is there one upside into this which is for the first time in a decade we have actually seen members of senate and the house come together and agree on anything. >> that's the thing i took away, too. >> both sides are equally outraged over both issues. if you want to find a positive in all this, i know it's a small thing, at least maybe now the two sides are talking of a common beef. >> the epipen issue. it's a big deal. we buy them. the problem is that you buy these things if you have one child who has an issue who needs this, you need it for your house, you need it for the car,

you need one for the school and these things expire every year. i can afford to pay it, it's not a big deal, but for a family, it's $1800 to make sure you're covered and you have to throw it away every year. >> thank you, meg. the stage is set and the markets will hear from the fed on its decision on raitts. joining us is jim mccoggin from principle investors. drew mattis is also with us from ubs. i just frame this whole conversation around the fed. before we do that, because it's the part of the day, i wonder if it will impact what happens later, what do you make with what happened to the bank bank and what that means? >> it was unexpected for us. what we're seeing out of the bank of japan is good news. we can't keep doing the same thing that's working and hope it

continues to work. they're trying to figure out a policy that does work for them. that's a much healthier environment than the one we had yesterday. >> we go to a zero interest rate target for ten we're government bonds. what's the lesson in that if you're gjanet yellen? >> i'm not sure there is one because the economic situation is so different. for japan, they're trying to do everything with monetary policy. they need a more accommodative fiscal policy. it's too tight. they need structural reform to get the labor market moving. this has been an ongoing conversation. >> are they not going in the right direction? >> they're not. >> are you talking about taxes? the taxes at times they pit off? >> yeah. >> we have heard the prime minister, shinzo abe, talking about trying to change the structure of the work force getting more women involved. that will take years. >> it takes years and years culturally but it also takes

quite a bit of policy change to make it really happen. you have to work through education. you have to work through training. get people on to the labor system. >> i never got the sense that women in japan are not highly educated. >> they're highly educated but not in a sense to get a job. that's not been their insenttce in the past. but you need more of a vocational training attitude and getting people into the work force with more diversity. while women are out of the work force in japan, to the extend they r you will see slow growth. these are the kind of structural reforms they need. on the fiscal side, they had the right idea moving towards goods and services tax, but they did that without giving relief on the other taxes. that means fiscal policy is too tight. now, they have a high debt level, so it's very difficult -- >> how do you manage that.

>> my view would be that they need to have a more accommodative fiscal policy in order to pay off the debt. >> i worked for the japanese more than 20 years ago. not for a whole long time, but you get an insight into the culture. in japan they don't have nursing homes. when you're elderly, you live with your family. the demographcrat gra demograph people of japan, so many older people are living at home, i don't know that anything that bank of japan is doing will solve that, because all the excess cash is going towards tending to the elders. >> shinzo abe talked about monetary policy, fiscal policy and structural reform. they're trying to win with one arrow. >> you think the other stuff is just talk? >> at the moment it is. i would like to see them be more accommodative fiscally and get to grips with structural reform.

the contrast to the united states is we had some really quite significant structural reform for example, twe had a period, correctly under both parties, of fiscal easing and of a big deficit. that worked in the u.s. >> let's go domestic, since we did set this up as a fed conversation. what would happen if they move today? nobody thinks it will happen. >> i think the initial response would be negative with equities down. >> how much? >> i really can't put a number on it. no one is expecting it. i don't think it would be a great day. >> how bad a day? >> couple percentage points. at the end of the week i think you would look up and people would be more okay with it. i think it would be a net positive if they had gone today. >> any chance in the world? >> there is a chance but not a high chance. i hope they raise rates.

the economy can take it. >> how would you position your portfolio if you were a short-term trader today? >> you would be looking for the dip to buy. >> all right. >> that would be my advice if it's any use. >> we'll leave the conversation there. guys, thank you. when we return, former president bill clinton weighing in on trade and corporate taxes. we have his comments from our interview with him from the clinton global initiative. that's next. and music that can make you feel better. we'll tell you which song is the happiest song in the world. i can think about five that might qualify. that's just me.

with this level of engineering... it's a performance machine. with this degree of intelligence... it's a supercomputer. with this grade of protection... it's a fortress. and with this standard of luxury... it's an oasis. introducing the completely redesigned e-class. it's everything you need it to be... and more. lease the e300 for $549 a month at your local mercedes-benz dealer. mercedes-benz. the best or nothing.

♪ >> welcome back to "squawk box." you're listening to "don't stop me now" by queen. we're playing this song because it's supposedly the happiest song in the world. >> boo. >> a neuroscientist at the university of missouri used answers from a british music survey to come up with what he says is a formula for songs that tend to make people happy. among the findings, the average tempo of a feel-good song a

higher than the average pop song. >> this song is not happy. >> i'm just telling you what this gentleman -- >> he's just the messenger. >> the song is making me angry. >> me, too. >> it includes key, theme and lyr lyrics. i have gone online to see what other songs that might make me happy. they have not put out a full list. >> i can think of 50 other songs. >> i can think of another queen song. "you're my best friend." >> how much do you think this is a cultural thing. >> yes this is a british thing this culture does not translate. >> it is based on a bretti ibri survey. >> this song is filled me with rage now. >> can we play "you're my best friend" by queen? that's a far better uplifting -- >> that's a good one.

>> this is ear worm. >> this will make you happy because you knew it as a child. >> which song was that? >> "small world." >> that makes me filled with rage also. if you go to disney, you realize it's not a small world. ♪ if you want to be happy for the rest of your life ♪ >> something fun. yesterday i sat down with former president bill clinton -- >> is that meatloaf? >> no. much older. ♪ >> i digress. yesterday i got the chance to sit down with bill clinton, the former president at the 12th and final meeting at the clinton global initiative in a wide-ranging conversation on cgi and hillary clinton's race for the white house, we talked about economic issues as well this is what he said about job losses from tpp, even though he is still defending nafta and where he thinks the u.s. corporate tax

rate should be, and it's not what the hillary clinton campaign is promoting now. >> what do you think about tpp? people look at that as the legacy for nafta. >> i don't think it has anything to do with nafta. the geopolitical reasons for it from america's point of view are pretty clear. it's designed to make sure that the future of the asia pacific region economically is not totally dominated by china. it's clear what hillary said about it. and that is that there needs to be provisions on currency manipulation that are enforced. and there needs to be, again, measured put in place in america so that we take care of whatever dislocation ever happens

simultaneously. everybody makes nice about doing something about it. then at least for the last 20 years for most of the time congress never wanted to do it. you just can't do that. it's not true. in places where there's physical isolation, the market economy will not make up the difference unless there is a real investment or a real investment incentive or both. >> what's the right corporate tax rate to make sure you're bringing in income and also incentivizing businesses to be investing in america? 15%? 35%? somewhere in between? >> i was the president who urged it to be raised to 35%. but when i did it it was precisely in the middle of the oecd countries. it isn't anymore. so i believe -- i think it should be lower. this is just me now. i think it should be lower.

and there should be -- we should do sort of what the japanese did. we should try to get it as close to the international average as we can, so we'll be competitive. but we ought to have an alternative minimum so everybody pla pays something that's acceptable and you don't have to worry about finding every last tax shelter and every last this, this and the other thing. just say, you know, do that. i would like to see a repatriation initiative that works differently than when president bush signed one. this is one where he has a more liberal position than i do. because he got so mad that he signed the 5.75% repatriation bill, and he said none of it was it was reinvested. it was all stock buybacks. i think we should allow

repatriation if x percent of the money, whatever it is, some percent, goes into buying investments in the national infrastructure program. if we have infrastructure banks. this is not rocket science, it shouldn't be considered theology. this is a practical problem that we should do whatever is necessary to maximize job growth in america. >> gentlemen, that's very interesting because that is not what the hillary clinton campaign is actually out there promoting. if you look at it, their plans don't lay out anything. >> she hasn't said what her corporate tax rate is yet. >> the assumption is you would leave it at 35%. donald trump has come out with the 15% tax rate. but when people talk about what bill clinton did and where they think he would be centrist,

that's an example of where bill clinton still continues to be. the question is whether hillary clinton is in that camp or not because the democratic party has moved so far left, bernie sanders, elizabeth warren, a lot of other people who would not go along with anything like that. >> you don't think they would go along with it, if the money brought back in repatriation with you tied to an infrastructure bank of some sort? >> you hear constantly that anything that can be decided will have to be revenue neutral, but that won't take into account anything you might get in additional growth if you lower the tax rate. >> i like that plan. his plan. >> the effective tax rate of most corporations is nowhere near 30%. >> 28%, 29%, 33%, 35%, the idea of making a fairer tax code where you can't do work-arounds,

making it fair across the board is a good one. >> the tax code is so charged, the feeling of corporate america is so anti-certain things on the part of the hill, no tax deal is possible. giving a corporation a break when you have wells fargo, mylan going before the hill, americans are skeptical, giving them a tax break is not something that will happen. >> i think there's a decent chance in the next four years something happens. >> i hope you're right. >> i would have thought that -- >> i found your play list of the top ten happiest songs. let's tease it. we don't have just one. >> are there other nine you agree with? >> not at all. well, a couple. >> all british? >> no, i'll give you a clue. girls just wanted to have fun with cyndi lauper is one of them. >> that makes me happy. there you go. ♪ >> i'm happy now.

coming up, new this morning, the federal election filings revealing where hedge funds and big businesses are throwing their support ahead of the november election. details ahead. and let's look at yesterday's s&p 500 winners and losers. some of the winners, royal caribbean, gilead sciences, let's forget the losers because you're our best friends for tuning in. we'll see you back after the break.

opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.

whoa. what's going on here? oh hey allison. i'm val, the orange money retirement squirrel from voya. val from voya? yeah, val from voya. quick question, what are voya retirement squirrels doing in my house? we're putting away acorns. you know, to show the importance of saving for the future. so you're sort of like a spokes person? no, i'm more like a metaphor. okay, a spokes-metaphor. no, i'm... you're a spokes-metaphor. yeah. ok. see how voya can help you get organized at voya.com. bacteria can hide in food and make you ill. wow! announcer: but you can keep bacteria from ruining your day with 4 simple steps: clean. i'm ready for the rinse cycle! announcer: separate. all: woah! announcer: cook. fire in the hole! announcer: and chill. chipmunk: we chipmunks are notoriously tidy. announcer: check your steps-- the roadchip to food safety starts at foodsafety.gov.

chipmunk: whoo! this is awesome! we're drowning in information. where, in all of this, is the stuff that matters? the stakes are so high, your finances, your future. how do you solve this? you don't. you partner with a firm that advises governments and the fortune 500, and, can deliver insight person to person, on what matters to you. morgan stanley. ♪ you are the dancing queen

♪ >> welcome back to "squawk box." this is cnbc, first in business worldwide. it's fed day, we're counting down to 2:00 p.m. getting jiggy with it here. that's when we'll get the latest on interest rates and the question and answer session by janet yellen. the reason we're playing this song -- >> number two. a dutch neuroscientist in england -- that, right there. >> i'm making a spotify list and sharing it on twitter. this one doesn't make me sad. >> this is number two behind "don't stop me now." >> are they in order? >> i believe they are. >> there are some surprises on

this list. >> today we don't know what fed is going to do. if it were to raise interest rates this time around that would be a surprise to the market. u.s. futures are indicating higher. the dow futures were up for the morning for the last three sessions, the last two sessions they have given back those gains. obviously today's decision will be very much centered around not only what the fed does, whether it does or doesn't raise interest rates but what it says and what that means for people in terms of whether a rate hike is coming in december. the dow futures now up by 74 points. s&p 500 futures up by close to 7. nasdaq up by 23. the latest federal election commission filings on campaign donations are officially in. the latest read on where hedge funds and other big businesses are throwing support. kate kelly has more on this.

>> interesting overnight results. hillary clinton continues to dominate at least when it comes to hedge funds and private equity funds. look at her latest polls from hedge fund donors. donald sussman, $2 million. the founder of a connecticut-based hedge fund. i believe he's her single biggest donor from that industry certainly and from any industry at about $13 million or so. george soros, 2.5 million dollars. he's been supportive. i will correct what i'm saying. he's given north of 25 million, reportedly, in various ways, pacs a primary target. henry laufer, he and his wife donating this past month $1 million from henry and additional money from his wife. the total for clinton compared to trump is remarkable. based on the center for

responsible politics. $33 million from both hedge funs and private equity firm donors versus about $188,000 for donald trump. one other caveat there, that's hard money, money given directly to the campaigns. donald trump has some hedge fund supporters, but no big ones that materialized in the past month. carl icahn, $50,000. not a huge sum of money for a guy tremendously talkative and supportive towards trump. john paulson, $250,000. you may recall he hosted a fund-raiser for trump. and nelson peltz, $50,000 to various trump causes. >> icahn mentioned in the past when he was one with scott wh wapner in the last month or so, he didn't want to be an economic

adviser for trump because he wanted to put his money into a pac, and there are rules against that if he's an official adviser. the other thing is does trump use this as a point of pride, i'm not taking big money from wall street, they don't like me because they're afraid of my policies. you wonder how that plays. >> he does use it as a point of pride. he used it on the stump. some figures trickled out over the summer based on a "wall street journal" story that was erroneous, but the basic point remains the same. tens of millions to hillary clinton. tens of thousands at the time to trump. now hundreds of thousands. i think your point on icahn is right. this money has not materialized. another big example of that is sheldon adelson, he at one point said he would give 100 million, he endorsed trump in may. >> gave money to everybody else down the line but not to him.

>> this week it leaked he was expecting to give 5 million to trump and 40 million to the house and senate republican races through pacs, but that did not materialize over night. supposedly he will direct it towards this joe ricketts t.d. ameritrade. another one who has changed tune. that adelson money has not shown up yet. i assume it will since they're being fairly public about it now. it will be in the home stretch for sure. >> thank you. coming up when we return, the refugee crisis is front and center at the u.n. this week. it's generating controversy on the campaign trail. we'll talk to a leader of the international rescue community after the break. a quick check on what's happening in european markets. green arrows across the board. the dax up over 1%. it's fed day. will this be a september to

remember or will the central bank punt until december? we'll tell you what to expect before the 2:00 p.m. announcement straight ahead. this car is traveling over 200 miles per hour. to win, every millisecond matters. both on the track and thousands of miles away. with the help of at&t, red bull racing can share critical information about every inch of the car from virtually anywhere. brakes are getting warm. confirmed, daniel you need to cool your brakes. understood, brake bias back 2 clicks. giving them the agility to have speed & precision. because no one knows & like at&t. but the best place to start is in the forest. kubo: i spy something beginning with..."s" beetle: snow. kubo: no. beetle: snow covered trees. monkey: nothing to do with snow. narrator: head outside to discover incredible animals

and beautiful plants that come together to create an unforgettable adventure. kubo: wow! narrator: so grab your loved ones monkey: don't even. narrator: and explore a world of possibilities. kubo: come on, this way. narrator: visit discovertheforest.org to find the closest forest or park to you.

welcome back the global refugee crisis is front and center at the u.n. this week and on the campaign trail. president obama addressing the general assembly on tuesday with a plea that wealthy countries should do more to help the crisis. and donald trump jr. weighed in with this message, if i had a bowl of skittles and i said three will kill you, will you take a handful? that was the tweet. the international rescue committee saying not just a refugee, definitely not a skittle, a human being. let's bring in our guests. david and steve, thank you both

for joining us once again. >> good to be with you. >> an issue that's been front and center with more refugees than we've seen any time since world war ii. this week at the u.n. we've already seen about $500 million in corporate money raised and pledged to aid this goal. maybe, steve, you could tell us about why you're raising the money right now. >> the crisis is just so imaginable. are you going to be one of those companies or individuals that keen of sits and whlaments and watches or will you do something? tripadviser has made a large grant. >> where does that money go? >> to the irc that is on the ground in these hot spots. if you get a generation of refugees growing up in the camps, you're setting the seeds for disaster coming down the

road. how about the educational needs? how about the basic humanitarian needs that just need to be addressed by government and we feel the private sector can play an active role. >> david, this has been a growing problem. it's been building. you joined us on set in the past to talk about it. where do things stand now? have we made progress? are things getting better or is the conflict taking place in the world right now just overwhelming the best efforts? >> two things are happening. first, the political inertia, people are stepping up and addressesi addressing the crisis. and the second thing is the wars are carrying on. my own organization lost a pharmacist and five others in a bombing raid at a hospital. you had an appalling incident of a u.n. convoy being bombed. the work that's being done to

mitigate the worst aspects of the civil wars is more intense and has gotten greater amental problems are driving these people. steve has put it in a clear way. if we don't address the problem, it will get worse. obviously it's leapt up on to the shores of europe already. >> what's happening now in terms of people being able to move out of these camps? i get the sense some of these people have been stuck in the camps for years and years. >> the vast amount of people are stuck in poor countries, lebanon, jordan, a very small number comes to the u.s. so far the u.s. resettled about 15,000 syrian refugees over the last five years compared to over 1 million in lebanon, 2 million in turkey, 800,000 in germany. the u.s. by the blessings of geography can choose which of the refugees come in after

significant vetting. >> can you speak to the economics of what you do? what does it cost you on the ground to do what you're doing? what does it cost to take somebody an resettle them? >> we help about 23 million people around the world last year. the work we do is the most basic, health, water, sanitation, protection of kids, education. that 23 million people in very broad terms cost about $500 million, give or take. that's the work that we do internationally. the cost of getting water on a mass scale is lower than the cost of flying someone over here and resettling them up in a new life. though they then become workers here. for the people that we resettle in the u.s., the figure for syrians within six months, 81% were in work, paying taxes, supporting themselves within six months of arriving here. >> have you ever mathed out what

that costs for that individual? what it costs you as an organization? >> we do we take the costs seriously. the complexity is if you have an or and if kphaned kid coming he not a salary person for ten years, that's different than an accountant being resettled in this country. >> huge props to the companies stepping up and doing what you're doing, huge props for doing that, but even $500 million is not really where the big money is. >> the big money comes from the governments, but corporate leaderships can take the risks to get there early, be in the most dangerous places. >> places that governments won't touch. >> sometimes the governments -- we are getting the people there, businesses can respond quickly and do the economic work. the things that governments don't want to take the risk for.

businesses can also mobilize their own employees. the interesting thing for us, over the range of corporate partners we have, when the leaders of businesses step up, employees will follow. >> how did you get involved in this? >> it's impossible in my view not to be involved. >> was it just something that you were reading and it sparked your interest and you decided to call him? i'm trying to understand the mechanics of how this happens. >> we set out a decade ago with our charitable foundation to do good. within our community of travelers, our community of hotel owners, restaurant owners, how can we mobilize -- >> matches up nicely with your business. that's why i was curious about the thinking process. >> we thought there had to be something we could do as a private organization. when we look at other public/private companies, not the governments, if each company could ask themselves how could they contribute something out of their own unique set of assets,

employee-based, what they produce to aid in the crisis that would be tremendous if everybody took that opportunity. steve, david, thanks for being here. >> thank you. coming up, oil on the move right now. it's up about 2%. stock futures also are higher. we have a full market rundown ahead of the big fed decision. "squawk box" will be right back. coming up, mylan's ceo heather bresch is in the hot seat this morning. she'll face questions from congress over price hikes for the life-saving epipen devices. we'll tell you what to expect straight ahead.

here i am... building a jet engine. we've been hearing so much about how you're a digital company, so you can see our confusion. ge is an industrial company that actually builds world-changing machines. machines that can also communicate digitally. like robots. did you build that robot? that's not a robot, that's my coworker earl. he builds jet engines with his human hands. what about that robot?

that is a vending machine, ricky. john, give him a dollar. this man creates software, to protect this customer, who lives here and flies to hong kong, to visit this company that makes smart phones, used by this vice president, this little kid, oops, and this obstetrician, who works across the street from this man, who creates software. they all have insurance crafted personally for them. not just coverage, craftsmanship. not just insured. chubb insured.

welcome back, everyone. half the world's population lives in urban areas and that number could grow to 66% by the year 2050. we heard from the liberian mayor who faced the ebola crisis shortly after coming to office. also top executives from major companies. here's what john chambers had to say on the promises of digitization for spurring economic growth. >> we have to rechange the education system. not for being trained like the people in this room were, but around technology at a very rapid rate. this is where businesses have to play a more active role. cisco we're committing to not training a million students a

year but going to 2 million. and in those training, 93% of the students use what they learned every day in their jobs. i think what if every major country in the world if not at 1% or 2% today, but at 4%. think whether every person could get pay raises of 5% or 10% a year. or in the u.s. finally get pay raises again as you move forward. it's that type of opportunity to where you could create in this country probably sustained gdp growth of 4%. probably 25 million to 30 million jobs in the next eight years. you could get real per capita income up. >> we also heard from jsk ceo whose successor was named yesterday. she's going to be the first woman to head a pharmaceutical company. >> the generation of young folk who is are coming out right now

around the whole world are a completely different generation. these are people growing up in a world of transparency whether through their phones or the internet. it doesn't matter where they were born. the problem, my generation, you, we need to think hard about how we give empowerment to that population as they come forward. i would make this comment. if you are in any way connected to any decision making around research in areas like health care or digital, then the question you should be asking yourself, your teams on those young people you're putting on these projects that are going to blow you away with their creativity and their ability to make connections, the question you need to ask them is it's not just about how to innovate. it's about how to innovate and develop a business model which produces global access to that idea. because innovation that nobody gets access to is not innovation. >> you can see the full discussion with all three panelists in a special presentation this weekend on our

global channel cnbc world. on deck, we continue our countdown to the federal reserve interest rate decision. but up next we talk the fed and making money in this market with a great guest lineup. it includes wharton professor jeremy siegel and economist vine reinhart. we've got you covered. "squawk box" will be right back.

you know what, guys? there's a lot of tree branches and dry brush over here. we should probably move the bonfire over there. [smokey whistling a tune] i'm guessing smokey liked that idea. what's that?

the number of units we'll make next month to maximize earnings. that's a projection. no, it's a fact. based on hundreds of proprietary and open data sets folded into a real-time, actionable analytics model. nine. eight. three. five. two. you're not gonna round that up? you don't round up facts. powerful analytics driving decisions for the world's most valuable brands. hewlett packard enterprise.

♪ 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 andrew ross sorkin along with becky quick and brian sullivan. our guest host this morning is jeremy siegel from wharton also known as the wizard of wharton. in the meantime let's get a look at the futures at this hour. looking up. we're going to tell you what happened across the pond or across the world, the boj. i don't know if that's what's impacting this or not. dow would open up 77 points higher. nasdaq up about 24 points. in europe right now we're also looking at green across the board with the dax and the cac up over 1%. let's talk about the boj meeting. this morning the bank of japan rebooting their monetary policy. they did not cut rates further into negative territory or expand asset purchases. instead it's introducing a 10-year interest rate target. the goal here is to try and

stoke inflation. came as a big surprise to most players. there were all kinds of moves that the boj could have done to ease policy. like lowering their interest rates further below zero. maybe buying additional bonds. the bank of japan will buy some low government bonds to keep the 10-year rate around zero. the as you can see it's back below that now by over 0.02 of a percentage point. among today's other headlines, futures are higher this morning but that likely has no relevance to where the markets will end the day. because investors are firmly focused on the fed policy. the will they or won't they raise rates. yellen's news conference will follow at 2:30 p.m. eastern. crude oil prices are also higher this morning by about 2%. that follows a surprise inventory drawdown in the weekly

report late yesterday. in other news, the justice department has filed terrorism charges against bombing suspect ahmad kahn rahami. he's accused of setting off bombings in new jersey and new york last week. let's get to meg tirrell who has some breaking news on zika. >> making available a new zika test that it is licensed from the cdc. this adds to offerings that quest already has available. the reason this is important is because the tests that test for the presence of zika can be useful really up to about two weeks after symptoms onset. where as an antibody test can be used 2 to 12 weeks afterwards. this comes as the number of cases in the united states are

increasing. particularly in florida. u.s. states more than 3,000 cases. u.s. territory, 17,000 cases. of course the vast majority of those travel related. the big concern here is among pregnant women. the cdc saying we've seen 730 cases among present women in the u.s. and d.c. a lot of people have questions about getting a zika test. not everybody can get one. as for the cdc's guidelines, they say only some people need testing. present women who may be exposed through travel or living in an area of zika transmission or through sex. and people with symptoms. the onboarding of quest diagnostics which has a lot of testing centers around the country and has more than 200, i believe, in florida, should help. what we're hearing is a backlog of people who want to get tests there. some important news today. >> meg, i can attest having gone

to rio and gotten a zika test -- my wife asked me to -- it is much harder than you would think. >> what is it? >> they take the blood. but no, no, to actually get the cdc -- >> to actually get the test. >> it was a whole thing. >> how did you get it? i'm curious. >> i ended up paying for it myself. you have to have -- you either have to show symptoms or tell them a lot -- >> do you say can i get a zika? no. can i get a zika test? >> no. i'm going to brazil. no. my name is -- no. my test is -- no. >> pregnant women have had trouble getting tests in new york and new jersey. >> why? >> because there's a limited number. >> also there's a lot of false positives with the test. it's a very complicated test to put together. >> if you had just gotten back to brazil you'd think you'd be on top of the list. one would think. >> yes. you have to tell them -- you

have to give them -- i was told after the fact that if i really wanted the test quickly and wanted the cdc to pay for it, that i didn't give the right answers. >> meg, the one question about the idea you need to show symptoms. this is a disease that only one out of five people show symptoms at all anyway. >> that's right. so a lot of people are concerned about that. that's why it's important to have multiple different tests available. obviously if you only have the test, the rna test which can detect recent infection, that's a problem. so the antibody test can test a later infection. but you point out many of the issues here that even after getting those tests, that's not considered a conclusive diagnosis. >> okay. meg, we appreciate it. thank you. >> thanks. all right. well, it is fed decision day. the markets generally expecting the fed not to raise interest rates. we'll know for sure at 2:00 p.m.

eastern time. a surprise could be out there for the markets. we're going to certainly find out. joining us now professor jeremy siegel from the wharton school. former treasury official now with ramko. and vince reinhart. i'll start with you. larry summers, you might be familiar with him. he's had a semi-tweet storm saying the fed should get off the idea that inflation expectations are not really accelerating and there's other ways to deal with any possibility of asset bubbles. do you agree with him? >> inflation is below the federal reserve's goal of 2%. they're not in any pressing need to tighten. but they do have to convey a willingness to tighten. and their problem about credibility is they've said they're going to tighten in 2016 for the last four years. maybe some time they have to do

it. don't think they'll do it today. they'll wait until december. they can set the issue up for now, but if they don't tighten some time soon, inflation's going to go over that 2% goal next year. >> john bellows, your thoughts? >> i don't think they raise today. but the first thing is growth needs to come into line with their forecast. the data's been weaker. until you see it come in line, i think the fed will be cautious. >> what data though? i know things have been softening a bit. but we are at crisis rate levels and we are so far away from a crisis. >> growth in the united states has been 1.25% over the last four quarters. we've seen retail, auto sales slip. this is not a robust growth environment. which is necessary to bring inflation up over time. so i think that's the first issue. i think the second issue and larry summers mentioned this,

this is expectations. vince may be right that inflation will move over 2% next year, but it's the medium term that they're concerned about. that's what expectations are telling you. i think the fed is appropriately focused not on what's happening in the first quarter of 2016 for inflation. >> yesterday, vince, i thought at our planning meeting for "power lunch" i said it's a binary outcome. then i was driving home and thought that was wrong. which happens from time to time. if they basically don't raise rates but say in literally no unclear terms they are going to raise in december, you know, borrowing some huge event, shouldn't with take that -- will the market take that as a rate hike regardless? >> you can call this a hard hold. it's not just what they do with the policy rate, in this case nothing, but also what they say in the statement, in economic projections, and janet yellen's

words in a press conference. so they've got a lot of opportunities to convey pretty strongly an intention to raise rates in december and get a lot of the pricing already done before they act. and i also agree they don't ever contract to something. all decisions will be data dependent, made meeting by meeting. but they can signal pretty strongly that the par fraction in december is low. >> that's the problem. they've cried wolf a lot of times with this. made the markets think they were in that direction. >> no hike today. but i do think they're going to tee up december. i think they're going to prepare it. i think they're ready to move by then. i mean, they've moved a large way towards their goal and in fact the words that they've been using were very near. certainly they're not going to do that the next one. >> wouldn't the market move if they basically say i'm going to do this in two months. the market's not going to wait, is it? >> no.

when you take a look, the odds on for a december move. and i think that there'll be a sigh of relief because people may think september -- and i think no so they'll say okay. but they're going to tee it up in december. they'll never commit to december because things can happen between now and then. but i think they're ready to move up by december. >> so i think there's a sense among some that we'll see a repeat of last year. where they talked about rate hikes and they finally had to do one. i think that's a bit of a lazy consens consensus. we've seen a big shift in their rhetoric this year relative to last year. so last year they were making the case for rate hikes. they were talking about going early and slow rather than being late and steep. this year all of that's gone and their rhetoric is all about risk management. it's about being cautious. it's about inflation expectations. so we would argue there's a fundamental dovish pivot this

year that's put the fed in a different position where they don't have to hike in december. so this idea you have to hike because you've been talking about it all year, i think that's lafs year's story. >> don't forget these, it's coming down rapidly. remember fisher at the beginning of the year had four -- we could have four rate hikes and talking three, four. if you look at the dot plot. >> for our viewers that may not be familiar with the charts and graphs. explain the dot plot and why we care. >> everyone contributes what they think is the appropriate policy rate at the end of the year for the next couple years and in the long run. so that's basically where they think the nominal federal funds rate is going to be headed over the next four or five years. and the key feature is it's been rotating downward. earlier we were talking about the growth not real satisfying. our forecast for the whole year

is 1.75% growth. that's above the rate of potential output. we've got a slowing population. it's aging and productivity isn't growing quickly. in that environment, we are working down resource slack slowly. but it's a reason they're going to want to tighten. not much. so too is the extent to which they actually have to tighten policy rates. that's why those dots are coming down. >> nominal gdp growth is coming down. that's why the dots are coming down. but it has a near term implication meaning they need to be more cautious. the fact those long-term dots are coming down has a very immediate implication which means they have risks on mop tear policy and they need to be more cautious. this is not a long-term issue, this is an immediate term issue. >> it's not just productivity being slow. it's been dismal. it's been disastrous. >> why would that ever change with the pace of automation?

>> if automation is changing rapidly, we should get better productivity growth. >> really? >> productivity is output per hour works. if we have robots doing our job, we should do more for output and we don't see it in the data. worst productivity growth since the end of the '70s which we understood because of recessions and energy crises. we've never seen anything as slow as we have right now in the post-war period. >> do you believe the numbers? is it a problem with the numbers or the actual productivity? >> well, there's always been a quality adjustment. you know, for the digital economy are we computing right. but this is a serious problem. this is the reason why real wages have not increased over the last five or six years and we're all trying to search for why has there been this collapse? >> we've got a whole hour. >> but that's factoring into what the dots are going down. >> the robots are making the models now anyways.

professor, you sit tight with us. john, vince, thank you both very much. and a programming note. you might have heard about this fed decision. well, it comes out at 2:00 p.m. eastern time, that's like 1:30 pacific time. i'm joking, john. followed by yellen's news conference. this could be a big one. even if they don't raise rates, if they give the hawkish tone, the market could move as well. so do not miss "power lunch," a fine program. coming up, mortgage application numbers out. we'll look at mortgage rates and what could happen if the fed does raise rates this year. and then later becky sat down with former president bill clinton. he weighed in on the wells fargo outrage. got highlights from that interview next. "squawk box" returns in just a moment.

welcome back to "squawk box" this morning. take a look at futures. because they are up relatively in a big way this morning. dow looks like it would open up 83 points higher. nasdaq up about 25 points. and the s&p 500 up eight points. samsung now saying that more than 500,000 replacement galaxy note 7s have been shipped to stores in the u.s. they are available starting today. that company you might recall had recalled 2.5 million phones after a malfunction that caused the battery to overheat, catch fire, in some cases explode.

received at least 92 reports of batteries overheating in the u.s. samsung is also rolling out a software update prompting users to turn off and exchange their note 7s. limited to a 60% charge. mortgage applications out just moments ago. diana olick joining us now. how'd they look? >> the numbers tanked which was not unexpected given that rates finally broke higher last week. total mortgage volume decreased 7.3% on a seasonally adjusted basis for the week ending september 16th compared to the previous week. and that is according to the mortgage bankers association. refi volume took the biggest hit. refi apps fell to the lowest level since june. refi volume is still higher than a year ago when rates were

slightly higher. the average contract interest rate for 30-year fixed rate mortgages with conforming loan balances and that means $417,000 or less, increased to its highest level since june of this year. that's 3.7% from 3.76%. doesn't sound like a lot but it is in mortgage land. now, home buyers are less sensitive to these weekly interest rate moves but purchase application still fell from the previous week and is just 3% higher than the same week a year ago. all eyes are on the fed today. even if they don't raise rates, the volatility surrounding the announcement today could move bond yields. interesting we're getting really early numbers in on august home sales, the realtors don't put them out until tomorrow. we're seeing an unexpected jump in sales. and that may be due to all this fear of rising rates that has home buyers on the fence jump in because they're worried they're going to lose some purchasing power going forward on this.

more online. back to you guys. >> diana olick, thank you very much. the numbers tanked. not the way you want to start the mortgage segment. >> probably not surprising as she pointed out. >> it's amazing that 3.75%, that's a high rate you're getting there. >> that's because people are refinancing. >> what happens when everybody refinances and then rates go to 5% or 6%, no one's ever going to move again. >> exactly. >> so we're doomed long-term. >> when rates spiked back in the '80s they had all kinds of mortgages that you locked in at 12% which was a great rate at the time, there were clauses that would allow you to sell that mortgage to somebody else and that was an advantage. >> professor, do you own a home? >> i do. >> home home dos you own? just say one. >> one for sure. >> would you sell now? are you worried about a housing bubble? >> no, i'm not. >> why not? >> because i think rates are going to stay low. not as low as now, but lower

than we've been used to for many years. i mean, yeah, we may get another half point, three quarters point in the next two years. that's not going to kill the housing market. i think right now given low rates and into the future, i don't see a bubble. i don't think it's slow -- >> do you think a slow economy -- >> beginning to soften a little bit. >> tingst coming down across the board. >> a lot is going in the uncertainty there. a lot of cash yields that are financed. what happens if interest rates or mortgage rates normalize to 5% or 6%, no one's even go to move, are they? >> but they're not going to for five years, ten years.

>> we're about household creation, right? >> you're helping. >> homeownership has dropped to a lower level since before the crisis to a high. a lot of the millennials are renting. they're not anxious to go into housing. we've got a lot of changes going on there compared to before. but if rates are not going to go up a lot, i don't think housing's in a bubble. >> jeremy siegel is going to be with us the rest of the hour. when we come back, what's the most important thing you are looking for in a partner? is it looks? is it smarts? how about their taste in music? spotify is hoping that's the case. we'll tell you why the platform is teaming up with tinder. >> i think it's a great idea. coming up, mylan ceo heather bresch is in the hot seat this morning. she'll face questions from congress over price hikes for the life-savining epi-pen devic. straight ahead.

what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley [baby talk] [child giggling] child: look, ma. no hands. children: "i", "j", "k"... [bicycle bell rings]

[indistinct chatter] [telephone rings] man: hello? [boing] [laughter] man: you may kiss the bride. [applause] woman: ahh. [indistinct conversation] announcer: a full life measured in seats starts with the right ones early on. car crashes are a leading killer of children 1 to 13. learn how to prevent deaths and injuries by using the right car seat for your child's age and size. enepeople want power.hallenge.

and power plants account for more than a third of energy-related carbon emissions. the challenge is to capture the emissions before they're released into the atmosphere. exxonmobil is a leader in carbon capture. our team is working to make this technology better, more affordable so it can reduce emissions around the world. that's what we're working on right now. ♪ energy lives here. welcome back to "squawk box." a new match made in heaven. tinder and spotify, they're hooking up to give singles a new way to find love. i actually think this is a good idea. users can now broadcast their quote, anthem, on their profiles to see who shares their taste in

music. the new update also lets you show your favorite artists giving users another reason to swipe right. >> swipe right the one you like or hate? >> i don't know. and if i did and i said right then you'd accuse me of knowing. but what i want to say is i think a spouse, that music matters. you have to line up a bit. >> i don't. >> you don't at all? >> no. look, you can appreciate each other's music to some extent. >> i don't think you have to like the same. but you can't hate the same. i love miles davis the sort of heroin era, some of the album names tribute to jack johnson. but this crazy period and she can't stand it. she just thinks spanish keys, i think she thinks -- it drives her insane. as long as you can avoid the music you hate, i think it's -- >> matt likes hair metal bands so that's okay.

>> does he really? giving me ammunition. this is great. >> hey. when we come back, a big week for ceos taking the hill. i spoke to former president bill clinton as john stumpf was testifying before congress yesterday. we'll tell you what he has to say about the controversy after this. always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances. announcer: don't let salmonella get funky with your chicken. on average, one in 6 americans will get a foodborne illness this year. so, learn the right temperature to cook each type of meat. keep your family safe at foodsafety.gov.

tempur-pedic mattresses is that they contour to your body. it keeps us comfortable and asleep at night. (vo) soft, firm, or hybrid... our three collections pair up to create the perfect bed for two. there's more than one tempur-pedic. what if 30,000 people download the new app? we're good. okay... what if a million people download the new app? we're good. five million? good. we scale on demand. hybrid infrastructure, boom. ok. what if 30 million people download the app? we're not good. we're total heroes. scale on demand with the number one company in cloud infrastructure. hewlett packard enterprise.

♪ welcome back to "squawk box" this morning. among the stories front and center at this hour, mortgage applications falling 7.3% last week according to the banking association. refinancing activity fell. now, the average 30-year mortgage rate rose three basis points. separately other news apple's new iphone 7 more expensive to build than the last. it cost just under $225 to manufacture. but that's about $37 more than the iphone 6s. and earnings out this morning

from food producer general mills. the company earned 3 cents above estimates. revenue was essentially in line although the company says its sales performance didn't meet expectations. general mills says that the macroeconomic environment is, quote, challenging. and that its fiscal year got off to a slow start for some of its businesses. big stories this week has been ceos testifying on capitol hill. that's going to continue today with mylan's ceo. yesterday was the day for wells fargo ceo john stumpf. i was sitting down with bill clinton just as wells fargo ceo john stumpf was appearing before lawmakers on capitol hill. here's what the former president had to say. he did share customers' and investors' surprise at the bank's blunder. >> the responsible thing is for wells fargo and our lawmakers and the press to, you know, look at the facts and do the right thing.

i'll give an example. i was really surprised by this wells fargo story because if you remember, in the housing crash in 2008, wells fargo got pretty good remarks. you know? their mortgage practices were less deceptive, they had less failure, they were generally thought of as a really responsible bank. so i was totally dumbfounded when i saw that they had these employees opening all these accounts. so here's what i do, like, in your position. i would say let's try to make something good happen now. they fired all these people, but they were all lower level people. it's very difficult to believe that there was no overarching policy and all the policy makers have been held accountable. so first let's find out what happened. second, to me this makes a good

argument for the financial product safety commission that we ought to keep that and we ought to take that right off the board of political debate. this proves that we need to do that. and then we need to see what else needs to be done. and i think wells fargo ought to come clean on this. because there is a lot of good will among people who watched that awful thing unfold in 2008. for what they did then. and so it's shocking that they're the ones that are doing this now. my advice is just get to the bottom of im, tell the truth, clean this up. because we can't afford it. i mean, it really broke my heart. >> wells fargo ceo john stumpf is not the only one facing tough questions this week on the hill. today mylan ceo heather bresch is going to be in the hot seat over her company's decision to drastically increase the price of its epi-pen. joining us to talk more on this,

is the dean for leadership studies at yale university school of management. jeff is also a cnbc contributor. jeff, we can talk about heather bresch and what she needs to say today. talk a little bit about john stumpf's performance yesterday. i'd love to start getting your view on what took place yesterday. it was theater but it might be more than that. >> yeah. i think there's a lot to talk about. i'm sure you'll throw me off before we can cover it all. because there are some parallels between these ceos and sharp differences. but yesterday it was an extraordinary theater. political theater, governance drama, and public safety financial wealth concerns. all wrapped up at once. you were talking about just earlier on the show how your choice in music reveals something about your character. if we were to take a look at what they did yesterday and consider the music from "music man," singing the wells fargo man is coming down the street i

wonder what he's coming for. you'd wonder what he was coming for. he went in there completely unprepared. he had a flack drafted public relations script that he read off of that was contrite and seemed authentic and then was melted in the easiest of questions that came his way. questions that should have been anticipated. when did he know, what did he know, who knew what when. he wasn't prepared to deal with the -- of course, the clawback issues. and he managed to unify this fractious committee. >> hey jeff, explain this to us. he deferred oftentimes in his answer and suggested that it really was the board. it was the board's call on his compensation. it was the board's call on whether to fire people, perhaps. it was the board's call on clawbacks, et cetera. that is true to some degree. how much responsibility do you hold to the board meaning to say

the board should have taken some action ahead of a hearing like that or does the board say, look, we've got to hear everything. we want to see where all the chips fall. by the end of this year, they may fall farther than we know and we've got to make a decision based on that. >> there's a lot of accountability to throw around. where were all the hundreds of regulators embedded in there from the consumer financial protection bureau, fdic, and the federal reserve. what were those people doing. but yes it's largely a failure of management oversight. ridiculous incentive scheme. >> my question is john stumpf, assuming the sbord involved, is he supposed to go to the board saying i'm going to go to this hearing and they're going to slaughter me. in advance of that, we need to make decisions to say certain things. maybe you should, you know, say that i'm going to get zero bonus this year or zero compensation this year. >> or you're going to clawback all the bonuses i have made.

>> yes. if you take a look at -- >> is that on him or is that the board? how do you look at that as a governance issue? >> this is him. this is somebody -- it's like lewis at bank of america blaming regulators for what he did. the devil made him do it. in this case he was deferring -- throwing the board under the bus. i know for fact that the board was stunned by a lot of that testimony yesterday. there's some of the complexity to this they didn't appreciate until yesterday. they should have created independent investigators. jamie dimon did at jpmorgan and of course did well with barra at gm. here he's just blinking in the spotlights unprepared. >> jeff, could i be more direct? if you were the chairman of wells fargo's board, would you fire john stumpf? >> he certainly should be put on probation. i don't think he'll be shot at sunset. people when they've gotten in trouble, they should be symbolically some punishment.

not just 3,000, 500 people making a few dollars an hour. we don't know what her accountability was. >> who is the constituency we care about? does he now -- whatever -- has the lost credibility with the investor community? by the way, the stock has fallen clearly and lost value. but now some people are picking it up thinking it's a good value all of a sudden. >> maybe. they took about a head of 10% going into this. the fact that yesterday was marginally up i don't think should give a lot of cheer. there's still a bit of trauma out there. the board should have been hands on. if you're on the board of home depot, you have to be mystery shopper at seven stores a quarter outside of your home state. u.p.s., they meet at a folding table. however, throwing this to the board was ridiculous. he should have anticipated the

clawback issue. >> he did it in -- did you watch jim's interview with him? he did the same thing in jim cramer's interview saying we have a board process. you're the ceo of a corporation. i understand there is a board, but we're not in germany where the boards actively run the corporation. these are quarterly meeting with people that barely have anything to do with the corporation. what do you think about anybody just deferring to the board like that just generally? >> no, he's running under the skirts of the board, running for cover i think it was pathetic. this happens to be a very good board with a bad process. people on this board are superb. talk about political influence and government experience and things, this board has it all. great corporate leadership. >> isn't he the chairman of the board also? >> the lead director, yes. >> he is chairman of the board. so he's deferring to the board that he runs. thank you to a viewer for pointing that out to me.

wow. >> i don't want to upset that viewer and all tuned in, but a lead director can still do a great job. we o -- in this case steve zhanr ceo of general mills is there. i think they're very much on the case now. the former ceo of deloitte is part of -- >> look forward for us. the other big news of the day is now going to be heather bresch who is going to -- from mylan -- who's going to have her own grilling. what does she need to do and are there any lessons from yesterday? the heat is still there. >> yeah. with heather bresch, we don't have fraud. we do have the public health. whap do they have in common? financial in the services industry, banking the mortgages, and on the other hand health care. these are both -- the public trust is so important. these things are being eroded. thomas moore once said that

trust of institutions is having liquid in your hands. once you separate the fingers, it's gone. you shore theing these things. we're talking about 40% of their profits. they have 90% of the business. and they have it because of the government. not because of entrepreneurs. this is a 40-year-old product that was $100, you know, when they got it. now it's $650 since 2007. based on what? based on the government protected monopoly. teva has tried to get in. somebody's running cover. it's classified as a generic on one hand, on the other hand they're blocking genuine competiti competition. the government should be looking at itself. as we don't have elizabeth warren with us today, this committee will have holmes norton and elijah cummings and

jason chaffetz. i think we should see -- if you saw toughness yesterday, i expect you'll see that today. and in this case terrible governance but worse governance. >> i'm not going to defend mylan. but i got to sit down with her a couple of weeks ago. the one thing i will defend in this respect, we did the interview in the morning. she came in with no lawyers, one pr person. we sat down and had a conversation and she left. she wasn't lawyered up like a lot of these people. we'll see how she does today, but i'll give her at least credit for coming out and sitting down and answering tough questions for what i think was an 18-minute completely unscripted interview. i didn't have notes. she didn't have notes. and she put herself on the line like that. again, has nothing to do with the increase. i'm saying as a manager, as a ceo, as a leader, do you place any i guess respect is the right word on that rather than having a fleet of attorneys where you're deferring to everything all the time? >> no, brian.

if you'll forgive me and i'm sure i'll hear from mylan's lawyers shortly, is because you were sitting with the ceremonial ceo but not the real ceo. robert corey controls this company. in this case the chairman controls this company. he can't be removed any easier than jack ma can be removed. but this european government way they have, he controls this company. there's no takeover premium for this company, for example. when teva offered over market, they could just turn it down. heather bresch at the company is what he said to fortune magazine, he said you know what a woman does for a household? that's what she does around this company. he's in charge of strategy. >> what? >> yes. that's what he said in "fortune." >> yes. >> that is such a sexist statement. >> he's in charge of strategy and crises. yes, you were sitting with the flack. you were not sitting with the main decision maker there. >> i mean, you know, come on.

you really believe that? >> come on what? just see what he says about the decision making in the company. he's the one who drives it. what's the name of the corporate headquarters? >> he built the building physically. >> but a very bizarre arrangement there. the complex financing of that that led to a scandal in itself. >> i love you, but those are different issues. i'm saying from your expertise as a managerial perspective do you give somebody credit coming in unarmed. that was only the kind of point i was making. >> i concede to you. i will give her credit as a communications officer titled ceo she did come in there without being defensive. and i thought you had a nice dialogue and she offered some kind of solution. we should give her credit for that. but saying they only make $50 from a product that only cost $100 and now $650 is like hollywood accounting. what overhead are they charging

where to get down to that number. i think that's very suspicious. but you're right. at least she offered something. corey we saw yesterday by the way with wells fargo is stumpf got stumped because he got caught walking in offering nothing. >> jeff, we need to leave the conversation there. jeff sonnenfeld unfiltered. we love seeing you. thanks. when we come back, today's biggest movers. stay tuned. you are watching cnbc, first in business worldwide. it's fed day. will this be a september to remember? or will the central bank punt until december? we'll tell you what to expect before the 2:00 p.m. announcement. straight ahead. my business was built with passion... but i keep it growing by making every dollar count. that's why i have the spark cash card from capital one. with it, i earn unlimited 2% cash back on all of my purchasing. and that unlimited 2% cash back from spark means

thousands of dollars each year going back into my business... which adds fuel to my bottom line. what's in your wallet? got a quarter?

ha-ha-ha! um-hmmm! hey! nikki! what are you doing here? you tell me, stephen. what? i'm snapping. you've been streaming my videos all morning. now you're with this thing? no! it's not you! it's verizon! they limit my data. i had to choose.

come on, girl. let's get us a man with unlimited data. why pay verizon more for data limits? introducing t-mobile one. one price. unlimited data for everyone. welcome back to "squawk box." take a look at the futures right now because they are up and up in a big way. we'll see whether they stay that way given what we'll hear from the fed at 2:00 this afternoon. dow looks it would open up 67 higher. the s&p 500 up about six points. pretty much everything in europe across the board in the green as well. all right.

coming up, don't worry. we're going to get to a lot more with professor jeremy siegel. we'll talk interest rates and his expectations about economic growth and whether the market is overvalued right now. and later on, becky sat down with bull clint-- bill clinton. we'll have more highlights from that. we're back after this.

all right.

here are some stocks you need to have on your radar this morning. skechers downgraded. taste in athletic footwear are focused on fashion and sales growth is slowing as skechers moves up to catch up. new skin enterprises paid about 6 -- improper payments to a government official. the company did not give any view. meanwhile carr max revenue was below street forecast. let's turn once again to our guest host for the hour professor jeremy siegel from the wharton school. let's talk a bit about where the markets stand at this point b. you've been somebody who's been bullish over the years. when you look at what's been going on, though, you admitted yourself that maybe we'll see what's happening. >> there's three challenges to the market. first of all, earnings which have been in a recession.

a lot of this has to do with energy. really should come back the second half of the year. won't be until the second week of october we begin to get third quarter earnings, but we want to see earnings start moving ahead instead of stagnating. certainly have is the uncertainty of the election. and then as i said, i think the fed is teeing up a december increase. so after the election, once they're trying to digest that within three or four weeks they're going to say another fed increase. so there's a lot of challenges there. that said, we have about an 18 pe ratio looking forward in a low interest rate environment. that is quite reasonable. i mean, that's about what's been called a 5.5% earnings yield. and that is a real return projection on the market which, you know, 5.5% is pretty good. >> that becomes the question how much of this is relative to

where interest rates are? >> well, but rates are not going to go that much higher. we wonder is the 10-year really going to go above 3% in the next five years? with slow growth, low inflation. slow productivity. >> so this comes from doug katz. he says if you're projecting interest rates this low this long, doesn't that also must mean you view economic growth and maybe corporate profit growth also as coming in slow? >> yeah. >> so why isn't it a little bit overvalued? because if they come in low bb then you raise the valuation over 20. >> a lot of slow growth -- in a way slow growth also saves cooperations money. one, they're not spending a lot is they don't need to expand. they're satisfying the demand. so there are -- >> this is this chicken and egg -- >> paying dividends and dividends are the story when you

can't -- zero yield everywhere else. i think the big tectonic shift is people are for the first time in maybe 50 years beginning to think about stocks as the income produces asset that they will need in the future. and that's what it used to be back before 1957. so i mean, i think that the fact/slow growth has that silver lining. you know, guys, i don't have to spend a lot on capex. there hasn't been -- one of the reasons interest rates are so low is there hasn't been any persuasive technology that firms think they have to invest in. that means more money back to the shareholder. >> and i guess what happens from that, though? there are all kinds of knock on effects that are going to be -- >> we like them.

standard of living is going to stagnate. these are not good things going forward. we would like productivity to speed up and we don't exactly understand why it's slowed down so much. >> the headlines for these comments if i hear you right, you are bullish and positive on stocks but not necessarily positive on the economy? >> i think that the economy is going to be in a slow growth mode for many years. >> and you can square those two things which would seem unsquarable or at least conflicting because corporations don't have to buy anything. they don't have to spend any money. >> that's right. that's right. i know people that -- >> was that on mike? >> but certainly we don't need that 8%, 10%, 12% earnings growth for stocks to be a good investment. >> professor, thank you very much for being with us today. >> thank you. heather bresch heading to the hill. she will testify before congress. we'll have a live report when "squawk" returns. r events to co.

well somewhere along the way, emily went right on living. but you see, with the help of her raymond james financial advisor, she had planned for every eventuality. ...which meant she continued to have the means to live on... ...even at the ripe old age of 187. life well planned. see what a raymond james advisor can do for you.

cue the clock. the countdown is on to the fed decision. on the hot seat. mylan ceo heads to capitol hill today ready to defend the company's epi-pen prices. plus the bike you can't

steal. we're going to introduce you to a small business with a very big idea as the final hour of "squawk box" begins right now. >> i meant to do that. ♪ live from the most powerful city in the world, new york, this is "squawk box." >> welcome back, everybody. this is "squawk box" right here on cnbc, first in business worldwide. i'm becky quick along with andrew ross sorkin and brian sullivan. we've been watching the futures this morning and on this fed decision day, futures are up. part of this is because of what bank of japan said overnight. they are setting a new benchmark for the 10-year. and that is something that the markets kind of took in stride looking at this positively.

they you can see the dow futures are up by about 68 points. of course all week we've had higher futures as we head into the morning nap has not amounted to much during the day. right now you can see it carrying out across the pond in europe with the dax up by 1%. same story for the cac in france. ftse up by about a third of a percentage point. two central bank decisions overnight. the bank of japan abandoning its -- nikkei closing higher on that news. almost 2% higher. up next, a policy decision is due at 2:00 eastern time here domest domestically. later janet yellen's big news conference. of course catch all of this live on cnbc. we're also watching oil prices this morning. take a quick look. we'll show you wti on the screen in a moment. the energy department will be releasing its latest inventory data.

reported crude stock fell unexpectedly in the latest. all right. other stocks to watch today include general mills posted better than expected earnings. revenue in line. the company says sales performance, though, did not meet expectations. general mills saying the macroeconomic environment is, quote, challenging. and that its year got off to a slow start for some of its units. microsoft raising the quarterly dividend and planning a $40 billion buyback. on track to complete its current buyback by theened of the year. fedex raising full year guidance to see income rising for the year despite the tnt express acquisition. by the way we're going to talk about fedex with an analyst in just a minute. among other top stories, mylan's ceo will be on the hot seat later this afternoon. heather bresch is set to testify at a congressional hearing about

the epi-pen price hikes. meg tirrell is in washington covering that story today. can we expect more of what we saw yesterday for john stumpf? >> well, becky, people are wondering will we see that degree of scrutiny here and it is a bipartisan hearing. both the republicans and democrats wanted to call this hearing. they've called not only heather bresch the ceo of mylan but also an official from the fda douglas morto morton. also on the fda side why we haven't seen competition. that will be interesting to watch. heather bresch saying that price and access exist in a balance. and she says we believe we have struck that balance. she goes through in the testimony. just the list price of epi-pen being $600 for two saying that's not the actual price many consumers have to pay. they didn't anticipate the rising minority, they say, of patient who is have to pay the high list price. as brian pointed out earlier,

mylan is not the only stock to watch today. as mylan has tried to shift the focus also to the drug chain in the supply of the industry, cvs health and united health which owns a manager may be under scrutiny today. as well as drug distributors who are also in the system like bergen and cardinal health as well. those are stocks to watch. if move lan was hoping some of the news may have died down ahead of the hearing, it was disappointed. with the attorney general of west virginia having them start to comply with the subpoena. to more scrutiny for the epi-pens for schools. and the involvement of mylan's mother in the schools program. and the senate finance committee also looking into the idea that mylan may have misclassified

under the medicare drug rebate program. a lot of issues swirling. probably all going to be addressed today. >> meg, outside of that, the financial times and i'm only referencing the ft because i think they're the only ones that have it. they call it an exclusive. they highlight a company called novum pharmaceuticals out of chicago. their linkedin profile says they have 11 to 50 employees. so it's a small company that was launched last year. according to the ft, they've got an -- it's called aloquin. it's in a tube and they've raised the price of the tube by 3900% in a year to $10,000 per tube. per tube. i'm not asking you to comment at that. i'm just saying that it appears this type of a thing is a new model for many start-ups. >> especially the ones that are able to carve out a competitive free zone. some place where there's nobody

else to get their foot in the market for something like this. that's what shkreli was doing. >> novum says $0 for some patients. who knows who some patients are. me thinks that as our esteemed pharma reporter, you will be uncovering more of this type of behavior. just a guess. >> yeah. you know, these things aren't completely uncommon. this is why we hear hillary clinton proposing a drug price oversight panel. really people to look out for these kind of drug increases. and determine what's appropriate and what's not appropriate. and then you have brent saunders coming out pledging not to raise by more than 10% a year. it's surprising when you still hear companies doing these just eyebrow raises increases. >> on the fda to streamline regulatory policies to get more competition. that can cut into some of these. they're able to corner the market on a drug where there is

no other potential the competitor in sight. >> yeah. and we'll hear from the fda today. one hopes we'll get more insight into what's going on to make sure the generic process is getting streamlined. that maybe there's prioritization. when you have mylan's ceo in the room like that, it's hard to think the fda will get as many questions. >> thank you. we will continue to follow through the day. again, meg's there in washington and will be keeping us updated on the story as it progresses. news just in from target. the company announcing a new $5 billion share repurchase program. the retailer is in the process of completing a $10 billion share repurchase. they also declared a regular dividend of 60 cents. the stock is up by 1.25%. >> since then the stock is up

36%. the market is also up. 36% gains since the first was announced. to what professor siegel just said which is if the economy is not that good and you're not going to invest in new plants or buildings or people -- >> this is what you do. >> this is what you do. you buy back shares. >> dividends. >> yeah. right. like microsoft jacking their dividend up today. let's talk about shares of fedex. they're rising this morning on better than expected quarterly results. joining us to break it down is donald broaden. the senior transportation analyst at avondale. good morning to you. >> good morning. >> you try to figure out how much of this is fed exspecific meaning they just figured out a better way and how much is a signal something good is going on in the economy? >> well, it's a bit of both. there's a lot going on good in the economy in the part of the

economy that they participate. e-commerce, e-tailing, amazon, walmart.com. we understand what's happening in that part of the economy. that's certainly great for fedex. but they've built on top of that. if you look at their ground volume, their ground volume was up 10% in the quarter domestically. so fedex continues to tear away. the last thing they've done a great job investing in technology, optimizing their network and spending more on much more fuel efficient, lift efficient planes. all those together mean that they're benefitting from a good economy but they're scoring better and better margins. >> is this a ground game or an air game? it's just unbelievable in the air. the margin is unbelievable what they've done. >> it is. that's a reflection of their profit improvement plan, the investment they made in the new planes.

literally this is usually one of the worst margin quarters for express. they scored a 4.9 operating margin. that's double what it was a couple years ago. >> we constantly talk about amazon and the impact of amazon getting itself into the logistics business buying airplanes, you know, working with competitors to fedex, et cetera. how much of an impact are -- have they had in terms of a margin crunch at fedex and elsewhere? >> well, amazon is doing what large retailers do. amazon is now 1/5 the size of wa walmart. they're building hundreds of millions of space across the united states. they're testing drones in the uk. they're patenting drone nesting

technology, all kinds of what seem like elon musk-bizarre things. but they're less than 3% of fedex's revenue and probably one of fedex's lowest margin customers. amazon is doing what large retailers should do. but in the grand scheme of things, they're symptomatic of buying more and more e-commerce, e-tailing. and as the next generation comes along and buys more and takes more of the spending dollar over, that trend is just going to continue. and fed ex, u.p.s. along with amazon are going to deliver it. >> fair enough. we appreciate your perspective this morning. thank you. >> always a pleasure. when we return, decision 2016. president bill clinton on his wife's race for the white house. "squawk box" will be right back. it's fed day. will this be a september to remember?

or will the central bank punt until december? we'll tell you what to expect before the 2:00 p.m. announcement. straight ahead. [alarm beeping] ♪ ♪ ♪ the highly advanced audi a4. ♪

♪ welcome back, everybody. we are less than a week away from the presidential debate of the election. voters will hear from donald trump and hillary clinton on the psalm stage. at the clinton global initiative this week we asked bill clinton about the former secretary of state and former first lady's campaign momentum which has changed pretty drastically. he let us in on the advice he gave his candidate spouse. >> we are less than 30 days to go to the election. polls have changed recently, momentum has changed recently. are you worried? >> nothing really surprised me. i thought, you know, way before hillary declared i said, you know, you got to get prepared from this.

i saw it happening other places. i said i think senator sanders will do well in the primary. i didn't know donald trump would be the nominee, but i think he'll get a lot of votes. i said, you know, there's a lot of populism because there's so much road rage. people believe the political and economic order have let them down. and you have to -- and we were talking and you're a sort of answers person, not an anger person. you feel anger, but you got to be yourself. go out there and try to be the grownup in the room and give answers. look what's happened since then, just the time of xenophobe nationalism doing well in the elections in germany and france. and then the brexit vote shows you, it's much more of -- kind of show yous america. urban people, young people, areas like northern ireland and scotland, they vote to stay. and england and wales, and the

turnout is what made the difference. the actual number of people who wanted to stay was slightly greater than the people who wanted to go. but the people who voted, voted to go. and so i'm not surprised by any of this. i just think hillary's got to bank on the fact that there'll be a lot of people watching the last debate. and just go out there and talk to people. and not be affected by all the meanness and all this stuff that we've seen. you know, i still think she'll be all right. but it's nothing much that's surprised me that's happened. it's hard for 80% of us to not have a pay raise since the crash. and, you know, there are lots of other problems. there's been a lot of social changes that i think on balance were good but it's caused a lot

of upheaval for some people. i think it'll be okay. you just got to get out there and work and let the american people decide. i still believe that in the end they'll choose answers over angle and empowerment over resentment. and unity over division. but they may not. and that's up to our fellow americans. they can choose whatever they want. but i know what works. as the economy has diversified, wherever people are working together, good things are happening. wherever they fight all the time, it might be healthy for the politicians that benefit, but not much good happens. still to come this hour, mexico's secretary of the economy is going to join us. but first we're going to talk about the bike you can't steal. we're going to introduce you to

one inventor making it happen. stay tuned. you're watching "squawk box" and cnbc. ♪ okay, so you launched your bank's app. now what? how will you keep up with the new demands of today's digital economy? the fact is: some believe they won't need a traditional bank down the road, so at cognizant, we're helping banking and financial services companies think digital, be untraditional, and reimagine what the bank of the future can be. our clients can now leverage customer intelligence to predict their financial needs and provide more contextualized products and services. we're creating new platforms across channels so customers can effortlessly invest, borrow, lend, transact-wherever-whenever they choose.

and we're digitizing the way banks run, driving efficiencies and delivering new value for their customers in return. digital works for banking and financial services. lets talk about how digital works for your business. ♪

welcome back to "squawk box," everyone. it is fed decision day and we've been watching the futures this morning. ahead of this day when the market is not expecting the fed to hike rates, but it is expecting maybe some tough talk, maybe some indication that it will raise rates in december.

you can see that the dow futures are up by about 67 points above fair value. s&p futures up by six. the nasdaq up by 20 points. and again, watch coverage on cnbc starting at 2:00 p.m. for this fed decision and then the live q&a afterwards. cnbc and inc. magazine teaming up for an iconic conference tomorrow with a look at the start-up scene. >> hey there. we are here at boston's hall ahead of that conference where i talked with one start-up that wants to be sure your bike never gets stolen again. anyone who's biked in a big city knows they're at risk for flat tires and potentially losing their bikes to thooieves if it isn't properly secured. >> we back it with a no matter what guarantee against theft. >> if you're wondering how, we were too.

the answer? a first in class security bolt. >> everything on it from the handlebars to the wheels to the seat is actually locked down with a custom security bolt. it's essentially like having a key to your car. >> the boston-based start-up launched in 2012 with a very different product. a bike light that was also impossible to steal. they went into boston tech stars in 2014 with their eye on moving into manufacturing a bike specifically for city riders. today fortified has raised $1.8 million and shipped over 500 bikes that feature puncture resistant tires and rust resistant chains. fortified rolled out on demand testing for their bikes so consumers can have a bike delivered to them and test it out for about ten minutes to see if they like it. the company says about 80% of those who do that decide to buy it. so if you opt for that test ride program and you like it, you have the opportunity to take the bike home right then and there. fortified is growing pretty

quickly. they're on track to ship 5,000 bikes by the end of next year. cnbc and inc. magazine, it's our last stop for the iconic tour. we have a great lineup tomorrow. you're going to hear from great entrepreneurs like the founder of crossfit. back over to you. >> thank you for that. it's kind of amazing. you want that bike? >> you know, i was trying to figure out how they make it theftproof. the whole idea of not being able to take things off and steel it. >> are you a biker? >> not regularly but it's a cool idea. i mean, i can bike. i'm going to hundred-mile bike ride with my dad in three weeks. >> how many bikes -- i don't know. i don't know how much you think about theft constantly. i haven't had that. >> if anybody out there is also doing the seagull on october 8th? my dad will be doing his 25th in a row.

my dad's 76 years old. >> hundred miles? >> yeah. last year it was rained out. so i shouldn't say in a row. 25th one because last year there was a horrible storm. we sat it out. they canceled the race. but i'll see you guyed in salisbury, maryland. my big butt will be on that bike. my dad's going to blow by me. coming up, mexico's secretary of the economy is here. we have a lot to talk about. the trade debate, the race for the white house, mexico's economy, the impact of oil prices. the futures are higher. big fed day. don't go anywhere. we're back after this. ha-ha-ha! um-hmmm! hey! nikki! what are you doing here? you tell me, stephen. what? i'm snapping. you've been streaming my videos all morning. now you're with this thing? no! it's not you! it's verizon! they limit my data. i had to choose. come on, girl. let's get us a man with unlimited data.

why pay verizon more for data limits? introducing t-mobile one. one price. unlimited data for everyone. [rock music playing] [music stops] [whistle] [rock music playing] [record scratch] announcer: don't let e. coli mosh with your food. an estimated 3,000 americans die from a foodborne illness each year. you can't see these microbes, but they might be there. so, always separate raw meat from vegetables. keep your family safe at foodsafety.gov.

♪ welcome back to "squawk box," everybody. here's what's making our headlines this morning. mortgage applications down by 7.3% last week. that's according to the mortgage bankers association. both new purchase applications and refinancing activity declined as we saw the average mortgage rates actually edge

higher. retailer target has announced a new $5 billion share repurchase program. this will go into effect as soon as the current program for $10 billion is completed. that program was ending effectively january of next year. and the music industry revenue is on the rebound. record company revenue totaled $3.4 billion during the first half of the year. that is up more than 8% from the year earlier. that's the strongest year over year growth since the late 1990s. the boom in streaming services is largely responsible. in other corporate news, samsung now saying 500,000 replacement galaxy note 7 phones have been shipped in the u.s. and are available today. the company recalled 2.5 million phones worldwide due to a malfunction that causes the battery to overheat and explode. it received 92 words of it. prompting users to turn off and exchange their galaxy note 7s.

a separate update limits phones to a 60% charge. and separately apple spending more to make the new iphone than it did the iphone 6s. that's due to new features such as bigger batteries and larger storage capacities. a teardown when they break the phone apart finding the total cost of manufacturing now about $225. that's about $37 more than the 6s. they sell the phone for $649. similar to rival phones made by samsung but apple commands better margins. tesla's rolled out a security patch for cars after uncovering flaws they said allowed them to remotely attack a tesla model s. the fix comes just a day after researchers published their findings on a blog. they engaged the brake on a tesla, turned on windshield wipers and opened the trunk. tesla said it fixed the vulnerabilities using an over the air software update.

we are counting the hours, the minutes, and believe it or not even the seconds to today's fed decision. senior economics reporting steve leisman is in washington where he's getting ready for the big news event at the yellen news conference right after. steve, expectations on wall street are for no hike this time around. >> yeah. it's a divided fed, but it is expected to remain on hold. choosing a cautious approach over preemptive tightening. there's some talk of a potential surprise. like bill gross saying the chance is actually 50/50. other fed observers, they say they're a bit nervous after calls for no hike. there's some reasons key members of the fed have sent signals that they would support raising rates. larry summers out on twitter with 11 reasons why the fed should not hike rates. they included increased dollar strength, no -- the economy is too weak to withstand it.

all reasons why summers says the fed should not hike. here are the reasons offered in the fed survey for why our panelists remain on hold. 22% say the market's not ready for it. some say the presidential election and also inconsistent and weak job growth. here's where the fed fund futures probability stands going into the meeting. 14.4%. it's up a little bit this morning. it had been a little bit lower. but that's showing you the market is unprepared for that hike. look in the statement for any future rate hikes. does the fed now say it's nearly balanced and removed over brexit. whether there's any benefit right now in the rise of the market. would prompt to think the fed is more hawkish and rating are going to up. not to mention all the volatility and the market selloff. it's hard for me to see any benefit to the economy, to the fed, or to markets here from a

surprise today. >> all right, steve leisman. steve, thank you very much. long day for you. we'll see a lot during the day with that decision and press conference. a lot on the line for mexico this election cycle. the two candidates opposed on everything including trade, immigration, the border wall, whatever. here now to talk about the implications is mexican secretary of the economy. thank you for joining us. a lot to talk about. let's talk about nafta. one of donald trump's big things is we need to change nafta. can nafta be changed? >> well, when you look at nafta, they had winners on both sides of the border. there are 6 million jobs created in the u.s. thanks to nafta. we are number two buyers of u.s. goods in the world. if you look at europe, mexico buys more goods than the european union all together.

so we have really a big trading partner of the u.s. >> well, trade is complex. here's how trump sells it. and respond to this. which is basically -- and i understand the point. it's easy to sell. ford recently announced they're going to be making more small cars in mexico. and somebody will say in michigan or ohio, this is exactly what we're talking about. mexico is stealing our jobs. >> well, let me tell you. today we compete around the world as a region. in america we make things together. and that makes us more competitive. yes, ford is making cars in mexico, but they are making luxury cars and the big cars in the u.s. thanks to the way we join forces, we become more competitive. if you start putting trade arrears against mexican against autoparts what you're doing is making cars in the u.s. less competitive. so the fact we work together makes us stronger. >> but you understand the point that there are going to be haves

and have nots in any sort of a tradeoff. >> but the point is when you look at trade, you have to look at losing jobs in small towns. it's due to technological change. but in terms of trade, what we're doing is trying to create more jobs. trade is to grow the size of the cake to bigger slices. >> tell us what really happened. trump comes down to mexico and the finance minister resigns. what was going -- tell us about some of the conversations that happened after that? >> well, i was not in those meetings. it was just the minister of finance and the minister of foreign affairs. and the point was -- the president of mexico has to talk to anybody who will have an influence in the world of mexicans. so you require in such a complex relationship to have an open dialogue. what happened at the end of the

day is obviously many hispanics, we feel threatened and of course insulted by some of these comments made in this rhetoric. the fact is you have to step up and tell your ideas screaming. >> will our relationship be better or worse if donald trump was president? >> the relationship has been stronger and stronger for the last 20 years. regardless of who is in the white house, we're supposed to have a strong relationship. there are illegal crossings every day. we're trading $500 billion a year. >> would you supportive of a wall? >> makes no sense. today you have a big -- >> if you don't like that wall and you think he's offensive why when i ask you if donald trump is the president whether the relationship stays the same you just told me it might get better? >> no, what i'm saying is that the relationship will go on regardless of who is in the white house. what i'm telling you is we have

been hearing candidates for the last 20 years. when candidates sit down in the white house, somehow their mind changes and they start looking at problems with a different perspective. because now they have responsibility to lead this great nation. therefore, i mean, remember mr. clinton when he was a candidate. he said he didn't like nafta. he ended up being the champion for nafta in the congress. mr. obama used to say he was not going to renegotiate nafta. . and he pushed ttp to make it one of the best platforms in the world. >> but let me ask this. you mentioned there was so much pressure because of the rhetoric coming from donald trump and that was coming from the average mexican citizen. is it harder for you to work across the table or, again, you just write this off to traditional campaign rhetoric? >> my idea in this campaigns is just wait until this game ends. and once somebody has the responsibility of the presidency, then sit down and talk seriously about the future

of the u.s./mexico relation. >> yeah, default -- >> it's okay. >> it went over. >> keep going, brian. >> i think the election is making you nervous. >> yeah. also the amount of coffee i've had this morning is making me nervous. i'm sorry, becky. i spilled coffee all over the set. this moment is here. congratulations. so do you feel like a lot of the talk then is just bluster? that if trump were to win that things are going to calm down? because there has been i don't want to call it anti-mexico rhetoric. because he did come down and meet with the president. but you feel some of it is just talk? >> what i feel is sometimes they look at the electorate. they are doing their jobs as candidates. and most of the time the people that has not really had benefit for growth and trade, that that is more outspoken in these types of elections. what you had to do is wait until everybody has a chance to make up their minds. >> you don't find any of this

offensive? >> it was offensive. >> it was offensive? >> it was offensive, definitely. i mean, the mexican people that comes to the u.s. are some of the best people we have. they are looking for a better way of life. they are doing their best to succeed. therefore i will never accept any of the comments he made about mexicans in the u.s. or in mexico. >> is the tpp -- what a great job we did cleaning this up. great, thank you, guys. i've got this. speaking of tp, i've got paper towels here cleaning this up. is the t. rks p going to damage mexico. it's meant to benefit asia. >> but after nafta, we have signed agreements that give us access to more than 1 billion customers in the world in mexico. for us, we have free trade agreement with europe. u.s. is just negotiating one.

we have a free trade agreement. for all the strategy to link to china -- sorry and croatia basically is going to be able to expand to a country growing for the next five years at the rate of 20% in those five years. so mexico has a story to tell about it. and tpp is the newest platform for trade in the 21st century. so for us it's the next step to take. we'll go ahead regardless of what happens in the u.s. election. >> secretary, what is the state of the relationship between your administration and u.s. business leaders? i know that the secretary was active in bringing additional foreign direct investment from the united states. there have been some ceos who

have worried. >> he was in charge for financial investment. bonds and financial papers. i'm the one that brings foreign investment. we have had a record in the last three years about $120 billion in three years and a half. just to give you an idea, and half of that investment comes from the u.s. because now we have the free trade. we're building things together and we're more competitive around the world. so foreign investment has been coming to mexico -- >> still a big area. >> and very rapidly. >> that's -- well, you know what? if we have time, can i ask about oil? we've talked a lot about oil and the impact. the head of penex back in april, he said something scary. like 30% of mexican federal government revenue comes from there. >> it was 40%. >> it was 40%?

>> it was 40%. but the point is after the old crisis, we did a tremendous effort to increase fiscal revenues and we were able to increase four gdp points. at the end of the day, the oil income went down half. but it was partial to recover by the fiscal effort to raise tacks. >> let me ask in a different way. are you planning for $40 to $50 oil now for the next couple of years? you've got to put that into your budget projections. >> no, no. we guarantee buying insurance against changes in prices. we buy coverage. so that gives you a lot of stability in that. as a matter of fact, i'm sure you are aware the new fiscal budget up to consideration of congress is a budget at least $300 billion is a big cut. stability, fiscal responsibility, no more new

taxes, and the fact is that we have to send the right segments to financial markets. >> his popularity has suffered greatly in the polls recently. what do you do to make up for that? >> let me tell you that when you do reforms like the ones he has done, you have a lot of interest. antitrust reforms. obviously -- >> and personal scandals have affected some of the popularity too. >> but he's responsible today for one of the most initiatives against corruption. he had taken to congress and has been approved the anticorruption laws. at the end of the day, the reforms that were done are the ones that were waited for 20 years. he had the political ability to put them together. >> is that popular with the electorate there? is that something they want to see there? >> the benefits of the reform keep coming to people. they are harvest from these reforms.

like cheaper telecommunication prices, cheaper electricity prices. that helps little by little to get more support for these reforms. >> before you go because one of our viewers wrote in and it's worthy. we asked you about donald trump. but we didn't ask you about the country's relationship with hillary clinton. >> the mexican relationship with the clinton has been a very good one. president clinton was the one to support the mexican package back when he was president. he supported nafta. and candidate clinton, hillary clinton, was in the state department and was in mexico very often. very closely following mexican issues. so mexico will build up a relationship with whoever is elected in the next november in the u.s. >> fair enough. thank you. >> thank you for rolling with the interview. thank you for rolling through what we'll now call the great coffee disaster of 2016. you did not flinch.

becky jumped up, coffee everywhere. >> we're all good. >> thank you very much. >> thank you. coming up this morning, stocks to watch including a big boost for adobe. "squawk" returns in just a moment. coming up, mylan ceo heather bresch is in the hot seat this morning. she'll face questions from congress over price hikes for the life-saving epi-pen devices. we'll tell you what tho expect straight ahead. what's the value of capital? what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley [music] jess: hey look, it's those guys. 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. whmade plastics that tmake them lighter?rs the lubricants that improved fuel economy.

even technology to make engines more efficient. what company does all this? exxonmobil, that's who. we're working on all these things to make cars better and use less fuel. helping you save money and reduce emissions. and you thought we just made the gas. energy lives here. welcome back to "squawk box," everyone. we've been watching the futures

this morning and they have been higher all morning long. not that that has meant anything this week with the trading sessions where we watched triple digit gains or anywhere near gains that fade away by the end of the session. today is fed day and that will be the big decision coming out at 2:00 followed by a news conference at 2:30. the dow futures up close to 60 points above fair value. s&p up by about five. nasdaq up by 17. among today's stocks to watch, adobe systems posting a 20% jump in third quarter revenue as it added more users of its cloud creative software. kb homes beating forecast although revenue was shy of estimates. deliveries of new homes rose 11% led by double digit increases on the west coast and in the midwest. and a familiar face from nbc's late night popping up in an unlikely place. an idaho corn maze.

the maze has been cut into the shape of jimmy fallon. check it out. the corn maze is comprised of nearly 20 acres and a million ears of corn. the farm owner says the whole process from design to cutting the pathways took a couple of months. >> that is a big jimmy fan. >> pretty cool, indeed. well, it is a big night on cnbc prime, by the way. tonight an all new "cleveland hustles." now that lebron james' teams have picked the businesses they will invest in, the companies have to find their new locations. just when the guys at cleveland bagel company think they've figured out their investor, well, alan throws a wrench into their plan. >> there's something wrong here. >> with the design? >> no, you've done a fine job. >> thank you. >> i think that we're designing the wrong space. maybe it's been in my mind too long and i didn't say anything, but you got a production facility 20 stinking blocks away. now you're going to open up and put in the same equipment,

double your workforce. i'd rather put my money into building a retail shop where the big els are really made. what are we thinking here? >> don't miss that all new episode of "cleveland hustles" tonight at 10:00 p.m. eastern and we return, jim cramer will join us live from the new york stock exchange. we'll get his take on the day's top stories. "squawk box" will be right back. announcer: they'll test you. try to break your will.

but however loud the loudness gets. however many cheese puffs may fly. you're the driver. the one in control. stand firm. just wait. [click] and move only when you hear the click that says they're buckled in for the drive. never give up till they buckle up.

sharing a ten by ten room,ng threestruggling.nding, i rent this place and then i started home sharing. my roommates help out all the time. they are glad to meet the guests and that opportunity that airbnb has given me is such a priceless gift. i was able to take three months off to take car of my family

during a family tragedy. the extra income that i get from airbnb has been a huge impact in my life. ♪ ♪ oh, i think i found myself a cheerleader ♪ >> with $15 trillion roughly on the central bank -- major central bank balance sheets with all of these rates at zero or even crazily below zero, you have a very delicate situation, which cannot be solved by a sledge hammer. you need some finesse. >> that was elliott management's paul singer warning central bankers have gotten themselves into uncharted territory. we'll see whether they continue on that same path a little later today. but if you want to know more about what he had to say about

the fed and assets that he calls the most undervalued in the world, you can head over to deliveringalpha.com for the full conversation. meantime, let's get down to the new york stock exchange where our good friend jim cramer joins us now. you talk about fed ex's earnings -- we can talk about a lot of things, jim, but i have to talk about john stumpf given you had that famous interview with him just a week ago. and then you saw his comments yesterday. >> look. >> break it down. >> he was certainly in a no-win situation because there have been no clawbacks. no one did get fired. it is a name recognition though john did say on my interview that there were people who were in senior levels at branches that did get fired. it just wasn't satisfying. and i've never seen the republicans and the democrats come together so quickly on someone on a man who really was known as the national community banker. so it's quite a switch. andrew, you've covered the bankers. you know that the ceos of the other major banks were always jealous of the profile john stumpf had because he was not involved with things in front of the justice department. well, this is actually in some ways for the american people a far more visible scandal.

and it's almost as if the bank did misjudge that. >> what i don't understand and i'm just curious where you come down is i have a huge amount of respect for john, i've known him a long time, you've known john a long time. i don't understand why he didn't directly go to the board before at least this hearing, if not before your interview, and say, look, there's a couple things we're going to have to do here. a, i'm going to take accountability and maybe i'm not going to take a bonus or a salary this year, whatever it's going to be. these two, three, four people, whatever, we're throwing them under the bus and they're losing their job. we are actually going to show some form of real accountability. instead, there was this to me strange deference which i don't know if it was deference or an excuse that he was somehow waiting on the board. >> yeah, i think that's interesting because he did shift really like a 36-hour period he shifted the issues about what has to happen on the board. but if you look at the board members, they are not of the typical -- i would not say

there's a lot of high-powered ceos or former high-powered ceos on the board who might be able to say, john, here's what happens when you get in washington. you got to get ahead of this. these were people for the most part, i'm not saying they were passive because they're business people, a lot of them political, some were in the army, some in government, but his council of advisors on that board i think were ill equipped to handle this scandal. john did not have the classic advice you would have about saying, listen, i'm giving the money back. i made enough money. and i didn't get it. i thought for sure between the time he was on my show and -- the board would take the action. i don't know. maybe warren buffett has to say something before anything happens here. >> we're still waiting for his words. we're going to hear more of your words in a couple minutes. sue you later, jim. coming up, we are counting down to the federal reserzervse meeting. and later today a first on cnbc

interview, fed critic jeffrey gundla gundlach, he's going to join the "fast money" crew at 5:30 p.m. eastern. fed at 2:00, fed press conference at 2:30 eastern, jeff gundlach at 5:30 eastern. we have a lot to do in the meantime as well. you're watching "squawk box." back after this. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities. we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.

what's going on here? i'm val, the orange money retirement squirrel from voya. we're putting away acorns. you know, to show the importance of saving for the future. so you're sort of like a spokes person? more of a spokes metaphor. get organized at voya.com.

there's no one road out there. no one surface... no one speed... no one way of driving on each and every road. but there is one car that can conquer them all. the mercedes-benz c-class. five driving modes let you customize the steering, shift points, and suspension to fit the mood you're in... and the road you're on. the 2016 c-class. lease the c300 for $369 a month at your local mercedes-benz dealer.

quick final check on the markets this morning. again, we have been looking at green arrows all morning. but the dow futures have moderated some of those gains. still up by about 53 points above fair value. s&p futures up by 4. thank you, brian, for being here. make sure you join us tomorrow. "squawk on the street" begins right now. ♪ do you remember good wednesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. fed day is here, the decision on rates, the press conference this afternoon. futures are up after minimal movement in stocks over the last couple of days. europe's in the green as global investors digest the bank of japan and their move to more finely control the yield curve. the yen has had quite a rise this morning. our road map begins with fed day,