handle. >> and that was blackrock ceo larry fink. he joined us for a half hour earlier this morning. let's get a final check on the markets, which have been solid for the entire session. still triple digits, up 116 on the dow. nasdaq up 55, s&p up 17. thanks, michelle. >> thank you, michelle. >> have fun at your vf circle -- >> i will see you all from california tomorrow. >> vanity fair circle meeting. >> make sure you join us tomorrow. "squawk on the street" starts right now. ♪ good tuesday morning. welcome to "squawk on the street." we're here at the new york stock exchange. earnings season goes from a jog to a run this morning. 11 s&p companies on the tape. ten of them beating on earnings. with that, futures are positive. we'll get to goldman, ibm, netflix and more. europe almost uniformly green.

uk cpi hits 1%, the highest in almost two years. as for our own core cpi, 2.2 is just a shade light. netflix shares soaring. reid hastings said it will double down on original content next year. >> goldman sachs beats both the top and bottom line. the shares, get this, they're up in the premarket. >> visa ceo charlie sharf resigning, saying he can no longer spend enough time in san francisco to do that job effectively. netflix surging after blowing past expectations. quarterly subgrowth of $3.6 million. the company also out with better-than-expected earnings. reid hastings last night on the earnings call. >> it's time for me to apologize for the volatility again. you know, this time it's good a good direction. but i think more and more investors are able to look at the multi-year picture and they see the patterns emerging.

and so then it would be less and less about our guidance. >> stocks on pace for the fifth biggest gap on earnings. i wonder if he's going to apologize for the volatility this time? >> they have hand-picked analysts that do the conference call. the conference call is really hilarious, frankly. and i want to say, i want to be picked next, i really do. i want to be on the hastings call, because the way this call should have within set up is, okay, let me just ask you, how much do you love ta-ta and how much do you hate pablo's mother. i'm not giving away any stories because it's very clear that narcos drove international. it was unbelievable. stranger things drove domestic, but narcos is incredible. i so much want to give away but i can't. i want to talk about the fact that pena is coming back and that gives away everything. it is so clear that this is a

hit-driven company. and the analysts keep talking about free cash flow and bound by the four walls of the spread sheet. what they should be talking about is how -- there it is, you see it? steve is back, pena is back. judy is probably gone. but this is about content and how much they love it in turkey, how much they love it in poland, how much they love it in latin america. this is a content play and he can't forecast other than the fact when he told me narcos was a combination of breaking bad and scar face. it's all algorithmic. >> they said they don't know what's a hit and what's not. >> but they do. if you like "breaking bad," you'll love "narcos." this is literally this guy and his partners coming up with stuff that we want better than

everybody else. they have a second and a third. they keep -- they are able to have noncancellable shows. i can't believe how good they are. >> they don't cancel them. we don't really know what the underlying numbers are. >> the show runners know the ratings. >> so you can argue all you want about if you like, they will like, but they can produce whatever they think is going to work and say it's working. there's no doubt "house of cards" drove the initial subs here in the states. >> it caused a shortfall in the second quarter. "house of cards 4" was a bust. >> i agree. and now "narcos," the ads was well above where the estimates were for analysts. the bernstein analyst said we can't figure it out because we don't know how much is going to drive viewership. so they will get to 100 million subs in the not-too-distant future. here in the states and internationally they're adding so many more. but they still have a long way

to go. i thought it was interesting when he pointed out video internet companies, facebook and youtube, video internet companies. >> right, right. the key line in the whole darn conference call. people -- people are begging them to say when are you going to stop spending. and finally reed gets sick of them and says, no, we'll keep investing in growing the contents. we see the ability to continue to please customers with a wide range of contents. so i think if you're trying to model a business, which is all these analysts try to do, if you're trying to model a business long term, you should think of content, hours viewed and brand love. i am raising numbers. here's what i'm doing right now. "narcos 3" raising numbers. i'm raising numbers right here. raising numbers pena. >> you know as well as i do that's a harder game than it looks. >> but not them. >> any primetime chief of a major network can tell you, you don't know what's going to be "empire" and what's going to be -- >> i do.

i really -- i don't know if i think that anymore. i think these guys are machines and they have learned. they're the only guys -- >> but they have a lot more programs than just "narcos" and not all of them are doing as well. $6 billion, $6 billion on programming in 2017. -- excuse me, $6 billion in 2016, 1,000 hours in 2017 so even more. >> brand loyalty per share is incredible here. >> i'm not arguing. you're just getting very excited about it. there's nothing wrong with "i love lucy." >> you're like a thursday night football guy. i am thinking big and she is thinking small. >> i have not watched a network show in years. i still have no idea what was going on by the way, but i enjoyed it. as did the rest of the family. >> how much did you love tata? >> i don't know what that is. >> tata for now. >> they are, even as they're

spending more in original, they're pulling in the number of other titles in their library, so there is that. eventually it will be more about what they bring and not whether or not you can see "godfather 2." >> it's hbo. >> but you take them at their word that they make more money on these. up front they don't. >> okay. >> okay. you dismiss me with faint praise. >> they are a powerhouse. they are going to be a part of our lives and everybody's lives in the streaming world for a very long time. they are helping to change this environment that we talk about so often and accelerate the cord-cutting that is taking place now at a rapid rate. it is starting to pick up big-time. we're going to be talking about it a lot in 2017. >> i think doueutsche is still a sell. web bush takes their target from 50 to 60 this morning. there are some nonbelievers out there. >> yes, they're spending a fortune on programming, but they're very good at

programming, okay. i think one of the things that came out about this quarter is, once again, the more the merrier. bring on more. we don't really care about the competition. it's -- the competition is great for us. i really like that. >> a lot of people do have two or three services. oftentimes if you have one, you're more likely to have another. if you have hbo you're more than likely to have netflix and hulu. >> why don't you join these people with the $60 price targets? i think you ought to sit down with reed hastings and listen to him. >> i would like to meet and talk to and spend time with mr. hastings. >> when you sit down and talk to him, the greatest comment is i'm going to raise 9numbers novembe 4th. why? because he is saying "the crown" about queen elizabeth, the most boring person in history, i'm

raising numbers "crown" per share right now. >> jim cramer, content programmer. >> i'm interviewing him next time. the world got tired of frank and claire underwood. but november 4th is going to be so huge. do you really care about elizabeth ii? i don't. but this guy will make me care. i'm going to care about queen elizabeth ii. >> we also care about goldman. >> yes, i'm moving on. >> what a transition. lloyd blankfein? >> goldman's earnings released, blankfein said we saw solid performance across the franchise that helped counter typical seasonal weakness. david will have an exclusive with blankfein tomorrow. >> get out! >> we can't wait for that. equity up 22. investment banking revenue -- >> not so good. >> down one. but they got their care share o ipos. >> they did.

investment banking was perhaps the least impressive part of it. fixed income currency and commodities. and when you take out the dva from last year, it's up 49% year over year. and i think a lot of the analysts are looking at that number. so you're going to see a number of notes this morning that say this was the best report we've gotten from -- it was so far not bad. jpmorgan sitting pretty good. b of a yesterday, fine. this one does look to be the strongest. they're looking to be keeping expenses in control. they're 39% comp rev for that quarter. >> staff down 5%? >> yeah. >> and the lowest share count they have ever had. >> yeah, they buy back a lot of stock. >> decreased by 1.8% for the quarter to a record low. >> they should just keep buying. that's what they're doing. it's an impressive quarter. >> i remember when david said they'd never get above 6. >> i said 10. >> how did you get the blankfein

interview? >> 7 a year ago. >> roe above 10 is impressive. can they keep it there? >> i don't know. you have to interview him and ask mr. blankfein. >> look, the banks have been good, okay, other than wells. wells wasn't horrible. i mean they obviously have a little transition problem there. but there is without a doubt one more group that nobody likes that is doing well, the banks. bank of america was a really good quarter. if we get this fed rate hike that everybody keeps saying we're going to get, you're going to wish you own this group. >> they did have a lower than expected tax rate at goldman. on the stock performance, we've watched these things fade every day. >> they cut your heart out. >> i know. they open nicely and then they fade, as we say. is that going to help with goldman today? >> remember, goldman has a window. they start selling stock and that always gets people down. it's not -- i watched bank of america yesterday open up big

and just sell off. at one point it was down. that's just crazy. it was such a good quarter. 17.40 book value. but they're not allowed to be in there -- the government tells you how much you can buy. >> do goldman's results make it less urgent to get into more consumer-facing businesses? >> i would think so unless it's at home. i mean i'm crafting a world for tonight on "mad money" where you never leave your house. you play war craft or candy crush for you, david. >> thank you. >> but you order domino's pizza. >> do you have your vr goggles on at all times? >> you will. you will. because you want to know who is real -- >> and your a.i. assisted robot helping you? >> you watch netflix where they are in your head and they are telling you you like this, you like that. you're ordering on amazon and you're going nowhere. you're literally going nowhere from now on. >> bad for ulta. >> yeah. you still, if you do go out,

you've got to look great and that's mary dillon ulta. >> people will be walking outside with their goggles on. bad enough they walk like this all day. now they'll just have gaug els. >> that could be. there's nothing wrong with that. >> the mall is going to look better in virtual reality than it is in real life. you'll be ordering away. you know, in the middle of dinner the other night, a box from rulala came to my house. just point that out. we've got to get to domino's, speaking of home delivery. >> so get this. >> do you want to do it after the break? >> no, no, we have to obey the programming gods. >> narcos 4, raising numbers, crowned. queen elizabeth ii. when we returning, the list of ceos stepping down is growing larger. details on why visa's charlie sharf is leaving.

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visa announcing that charles

sharf will step down as ceo effective september 1. he will be succeeded on the job by former american express executive and current visa director alfred kelly. scharf. whose family members reside on the east coast said, quote, i love working and running this great global company and i am sad to have reached the conclusion that i should step down, but running a san francisco-based company just doesn't work for me personally right now and wouldn't be fair to visa. jim, you broke this last night. >> yeah. this is a tough one. and the internal memo is very clear. you know, a lot of people resign to be with his family. yeah. there's some issues that he wants to deal with at home. he's an honorable guy. you notice he's staying on until december so there's obviously nothing untoward. i've met his successor, who's a terrific guy. but this is one where life is precious. balance doing what you need to do with what you want to do and that is what charlie scharf is

doing. charlie scharf is good at what he does but there's issues. and some people do have issues. when they have to address the issues, they do the honorable thing and that's what he's doing. >> it's interesting to see somebody who says spend more time with my family. he's only 51 years old. he was a very young guy when he got the job, he's still a young guy. i don't know much about kelly, who's taking over, 58-year-old member of the board. >> i met him when they put the super bowl together, he was big in putting the super bowl together in new york. an important guy at american express. very strong. but obviously charlie i think was one of these guys, he came in, was technologically backward. visa is always very smart, very sharp guy. i wish him well. we should wish him well. i think that he's -- some people have real issues and they have got to go do things and it's not like he's spending time with his family because visa wants to get rid of him. believe me, no one at visa wants him to leave. >> so you're not drawing a line

through any of those? >> i don't know -- i mean doug i thought was doing better. a savage piece in the "journal" yesterday. obviously doug is gone. i will tell you that they would beg to keep charlie but charlie has to spend some time in new york. sometimes things are as they seem, and the internal memo is what it seems. i just hope everything is good for charlie. >> there was a fourth too, i'm trying to remember, another ceo. it is interesting to see how boards respond here to try to figure out when the board has proactive or when they are in the case of scharf being presented with a situation where they have to figure out succession quickly. >> if you go over the internal memo that i got, it's pretty clear that this is not something he wants to do but he has to do. he's been -- the stock has gone from 30 to 80 under him and he's done a remarkable job and he loves his job. but his family is new york, he's back and forth and back and forth.

he does want to spend more time. they don't want him to spend more time with his family, they want him to do what is right, and what is right for him at this point is to do this. he deserves privacy. but i can tell you that this is his own decision, not visa's. that's very clearly not visa. not going to stay on the board because then he would be looking over the shoulder of kelly. but he's got a lot of things, he's done a lot of public servgs a service. he's a tough guy. sometimes i have said something good about some of his competitors, but he's a compassionate man and let's just take it as it is. those who say that it isn't as it is, i'm happy to explain to them that that's not the case. >> very nice. jim has good insight. we'll get cramer's mad dash, count down to the opening bell and take a look at the premarket. a lot of earnings of course. after the close tonight we've got intel and yahoo!. a busy day ahead. don't go away. what powers the digital world? communication.

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we've got seven minutes to get to the opening bell. let's get to our mad dash. we're going to talk a little big blue. >> they changed the name. it's called rodney dangerfield inc. they get no respect for the big change of this strategic imperatives that they moved up to, david. now represents 40% of ibm. each time the annual lists come up with new reasons. tax rate a little lower, gross

margins weren't that good for the cloud, this time cash flow. did they overproduce cash flow. so no matter what they seem to do, people don't like it. i would point out that the analysts -- >> that's because they have no organic growth, jim. >> oh, so okay, yeah go netflix. i talk about narcos, that's fine. they don't. they don't have enough. >> they obviously have the businesses you described growing very quickly. >> the rest is -- >> but the rest is falling off. >> i'm not going to disagree. if you read the questions, the analysts are very skeptical. these guys have delivered on how much should be cloud. >> they do produce a good deal of cash flow and return a lot to shareholders. >> but you know what, david, this is like charlie and the tuna. we don't want tuna with good taste, we want tuna that tastes good. they offer a big dividend. most growth, investors don't want a big dividend, they want solid -- they want service now, work day, they want salesforce.

oracle is doing a similar transition, okay. oracle, they're a little bit more boisterous. if you go out against them on the conference call, you often feel like -- you feel the lash. there's no lash here. but i've got to tell you that the analysts just don't like this company. they just don't. and it controls the narrative. it's a little like proctor, when they didn't like the ceo of proctor. so i feel like ibm is a little snake bit. would i sell it down here? probably not. but they're not giving the analysts what they want, they're giving warren buffett what he wants. he wants that stable cash flow and he wants that dividend. and so what happens is that they please one large shareholder who's already in the stadium, but they can't get others to come in the stadium. so it is what it is. >> they should ask watson what to do. >> i think watson -- watson had bob dylan in the act. >> you can't find him. nobel can't find him to give him his award. >> is that true?

>> yeah. >> maybe he's on highway 61. >> he might be. we've got the opening bell about four and a half minutes from now. stay with us.

♪jake reese, "day to feel alive"♪

♪jake reese, "day to feel alive"♪ ♪jake reese, "day to feel alive"♪

you're watching cnbc's "squawk on the street" live from the financial capital of the world. the opening bell in about 60 seconds. busy tuesday. in fact the busiest day for earnings season so far. we've gone through ibm, we've done goldman, netflix. domino's is not nearly as large on a market cap basis, but these kaump comps, jim. >> oh, geez. >> a two-year stack of 23.5%. >> this is an amazing, amazing quarter. fortunately, i've got patty doyle on who's very self-effacing. but 13.8% same store sales growth. they're executing at a very high level. remember, they're a technology company. i don't know those of you who order through their hand-held, but it's a remarkable company. they're getting it. >> technological reinvention,

recipe reinvention which happened a while ago but people forget. >> i remember when he asked me to do a taste test. when doyle asked me to taste test and it did taste more like corrugated than cardboard. suffice it to say if you order a pizza from there and do it on your credit card and you do it on your hand-held, it comes -- if they made a mistake, it's your fault. >> there's the open. just a few components in the red at the big board. it is north american utility fortis celebrating its listing on the nyse. o organ ovo. medical care up 4.9 is one of the hot spots, along with housing up 2.7.

>> we don't talk enough about the budget deficit in the united states, but holy cow. even if the country does better, the budget deficit is too high and health care is too high. >> entitlements. you want to talk that? we could be here for the next day. >> i don't think people would want to listen, but they should. >> it did spike higher recently for the first time in quite some time, although as a percentage of gdp, it's still not that worrisome. >> even though united health did have a good quarter, remember, they are now out of the 34 states. they have dropped -- will be dropping 34 states for the exchanges. optum is doing a very good job which is their consulting business. you know, we look at health care, j & j, i know meg is on that conference call. i've got to finds out more about why that stock is down but that seemed like a decent quarter. health care costs are higher. i saw val yangt -- valiant

yesterday. i don't know, i'm waiting for one more tweet from some politician saying that health care is too high and get another hit down. >> don't forget when you talk united health care, of course you've got anthem/cigna, man mana/aetna. we may not get that consolidation if one or both of those deals is turned back. >> unh is the top-performing dow component. second is goldman, which we touched on at the top and of course setting up an interesting bar for morgan stanley to climb. >> geez, i don't know. morgan stanley does a lot more personal wealth management, which was very good for bank of america. but this fixed income trading is really good for goldman. >> morgan stanley still has a significant presence in fixed income. >> they do. >> currency, although it's back and forth with morgan stanley.

some quarters have been great and other quarters not good at all. >> i know there's statistics that show earnings have not come in so well, but in the last 24 hours, i mean these earnings have all been pretty great. there's not a lot that -- >> it's still early. >> it's still early. we don't have caterpillar. i'm still reeling from that changeover there at the top. boy, that was just kind of glossed over, weasn't it? doug's out. doug came on tv a lot and i felt they were making a comeback. the stock didn't even glance, the stock didn't go down. i think tech is having a good run here today and nothing has really happened to tech other than f.a.n.g. f.a.n.g. is back. >> is netflix back in? >> yes. remember f.a. was a long, long way to go? reed hastings, "house of cards" cutting numbers. "the crown" raising numbers. it is that simple.

why don't you ask lloyd blankfein tomorrow when you get to interview him. >> stock picking is dead, "the wall street journal" point out again. active management, of course, on the run as index funds rise. i reference blackrock of course this morning also reported numbers. the largest money manager in existence, passes the $5 trillion under assets under management mark. >> passive versus the t-rows. >> eps 5.14, that was above some estimates. they did have operating income that was a bit lower than some had anticipated, but stock not -- it's actually doing quite well. >> stock is doing well. i regard them as -- guys, i'm not talking about f.a.n.g. time in back energy. people like buying f.a.n.g. no, stay focused.

>> what's the point? >> did you go to fab, facebook, amazon, alba bet. >> i've got a scrabble board here. i've got a double word thing. triple letter, david, jazz. you know, jazz when you start to -- >> i'd say that's a lot of points. >> two zs. >> quiz is good. >> quiz is good also. >> we haven't done chipotle. ray jay comes to an underperform. they say the sales drop could be more permanent than they thought. stocks back below 400. >> 18 months from your last incident is when they turn. and we are -- the last incident was in december, so it is too early to turn. i don't think the stock will have a big decline here. the company has bought a lot of stock, just a lot of stock. >> keeping it under 400 has been hard to do. >> look, and they're believers. i remain a believer of chipotle around the $400 level.

i just think that this is a company that is doing a lot of things to try to get things right. it costs a lot of money to be able to be the gold standard in health, and they did have some personal stuff that went on that wasn't so hot for one of their execs. but when you look at this united health, they are making a fortune off the health care system and their medical loss ratio is very low. they're a very good company. >> they are one of the insurers that we use, i believe. my plan here at comcast. and it's great, because they don't pay anything. >> really? >> they don't pay for anything. anything at all. >> everybody is healthy. >> cash. family of four. just -- >> i always go to the end of the statement and it says you owe. it's exactly whatever they charged. that's how they make their money. >> some of these guys, i had x-rays repeatedly on an ankle which everyone said was fine and they didn't want to give me the mri and i finally got the mri and i've got a broken ankle.

but that's okay. their job is to deny. >> no, health care costs have gone up a great deal and more and more is being born by us. we've got to go to the right doctor -- >> i know we're not allowed to be stock pickers anymore, but if you look at your personal and what you do is you buy united health against them denying you. >> they're not denying, they're just saying we're not paying that. >> oh, we're not paying that. >> you pay. >> how's your co-pay? >> it's 100%. >> i don't know. he must be on a different health care plan. >> i have a good plan, man. i have a dynamite plan. >> we're not. on netflix, guys, just quickly, worth noting stock up for the year now. it had been down. a $50 billion plus market value exceeds fox again. just interesting to look at the landscape when you talk about media companies. cbs is far larger, three times

as large as viacom and not even that far from time warner. >> have you seen cbs is making a show out of candy crush? >> i saw that. >> just announced a few moments ago. >> look, i've got to tell you, i like take two. it just unveiled a new game. but if you listen to that hasbro call and hear about all the different programming that's directed toward hasbro toys. but nerf is their biggest seller. hasbro doing very well. people didn't believe them last quarter that they had all this great programming. take two was up 2 yesterday and this is a new game that they have. i think that they have done a remarkable job there. these are companies very well run. very well run, the gaming companies. i just really think that they are superb. an i think that you can't beat the fact of this confluence. people are playing video games, they're ordering pizza, they're watching netflix.

that's it. that's all they're doing. >> you are absolutely right. >> zuckerberg talks about multi-tasking. they're watching while they're ordering and picking stocks. >> no, they don't do that anymore. >> one last thing, hog doesn't change their forecast. they meet ual beats boy a nickel, but guides look lower on -- >> nunoz was on "squawk box" earlier. >> the problem with the airlines. you've got a strong dollar and a lot of competition coming in underneath and you do have terrorism that has been a problem for the transcontinental. and then did i mention the home thesis that i have, like you're ordering pizza and you're watching netflix. that means you're not traveling. look, i know there's a secular increase in travel, i think a lot of it from china. but in this country there is a secular increase at staying at home. i'm talking about 70-inch screen. >> i got you, babe, don't worry.

i'm with you. just wait until a.i. takes over all things and then we'll sit home. >> you're really hung up on that. your driverless car and a.i. >> i am completely focused on the next 30 years and what's going to happen. >> i'm focused on the next 30 minutes. >> okay. >> there you go. >> i'm thinking the next 30 seconds, as we get to bob pisani. good morning, bob. >> good morning, carl. we have got a great start to the morning. we're talking 10 to 1 advancing to declining stocks. take a look at the sector leaders. banks are leading. i love that because they're in the earnings picture right now. consumer discretionary up. retail is having a good morning. techs, market leader for a while. oil is back over $50, so energy up. nice start to the morning here. we are getting into the heart of earnings season and away from the big money center banks and into the big regional banks. now, i like regional banks because that's when you see away from trading action, they don't

have big trading desks. they have loans and they have fees, and that's how their business works. comerica, dallas based, a huge business lender. interest was a little higher, the short-term rates were higher, loan growth down 0.5%. this is part of the problem. commercial industrials, c & i loans down 1.2% quarter over quarter. their guidance for loans next quarter, stable. that's their exact words. so let's call it fair but not great. this is the lone growth in the commercial side we've been talking about. a lot of companies not investing because they're deciding not to invest in capital expenditures overall. let's take a look at regions financial. this is arkansas-based. kind of the opposite. this is a big lender to personal business lines of credit. so not so much in the business area. average loans down 0.8%.

this is the hard for regions. up 1%, business down 2%. again, the same problem they're having overall. take a look at the numbers and the stock. comerica at a 52-week high. regions down a little bit and goldman on its numbers separately. great number to goldman, they're up about 2%. let me move on because there are very nice numbers over in europe. we gaaped up in europe and stayed up. so we're having a great day in italy, spain, germany, france. there's a couple of things going on here. there was some talk from a uk government lawyer saying that parliament had to approve brexit and maybe some were taking heart maybe this is a thing not being done. i don't believe it personally. another one is reports from a norwegian government commission, which is very interesting, about their sovereign wealth fund. they are recommending that that fund increase its equity

weightings globally to 70% of the right now it's at 60%. you might say who cares, this is 10%. they are far and away the biggest sovereign wealth fund in the world. they have nearly $900 billion in overall assets under management, $900 billion. china said, abu dhabi, kuwait are after them. if you actually break those numbers down, take 60% of 900 billion, what norway has, and you're talking about $550 billion in equities around the world so they're proposing adding $88 billion to that. they would have mid-$600 billion in equities. the global equity market itself is only about $69 trillion so norway owns about 1% of all the equities in the world and they're proposing to increase that. that's enough money to actually move the dial. i know this is a proposal, it's not actually happening right now, it's a proposal. they'll have some discussion on it. if it does, i think it's important and obviously i think it had some influences on the

market. right here in the united states, we're up 106 points in the dow. carl, back to you. >> all right, bob, thank you very much. let's get to the bond pits as well. a busy morning in chicago with our rick santelli. hey, rick. >> good morning, carl. it's fascinating to listen to what bob is talking about. lots of discussions about that on the floor. you know, when brexit votes first occurred, there were many that said it doesn't really counting. that has morphed into what may is trying to do with triggering article 50 versus parliament. many believe that that isn't going to be the way it turns out either. it's parliament or brussels, the people have spoken. you really have to ponder what that means or what it doesn't mean in the long and medium term. one week of two-year note yields, there's a drift lower, okay. that drift lower wasn't changed by anything perceived as hawkish by vice chair stan fisher. if you look at the ten-year since june, maybe yields are down a little bit today, they

were down a little bit yesterday, they're coming back up to that 180. stubborn long-end yields, you can see it on tens minus twos. getting very close to 100 as you see on this june 1st chart. then there's the currency dynamic of this. if you look at a chart since the beginning of march of the euro versus dollar, look at some of those key bottoms. a bottom in july of 109.77. a bottom around mid-october, not many trading sessions to go, 109.72. now let's go backwards. notice the intraday lows from sunday night were below both those levels. we didn't get the close. but if we do get the close, that's technically significant. give it a little sludge there, call it 109.50. if we look at the pound versus dollar, there's definitely some stabilization going on even though it is only a month to date chart. many are watching because of the historic drop of how that's

translating to a somewhat historic change in price action. carl, back to you. when we come back, new territory for under armour and it's quite big. we'll fill you in on that. as bob said, stocks up 104 led by unh and goldman. we're back after a break. when you're on hold, your business is on hold. that's why comcast business doesn't leave you there. when you call, a small business expert will answer you in about 30 seconds. no annoying hold music. just a real person, real fast. whenever you need them. great, that's what i said.

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♪ looks like a breakthrough for under armour. some published reports say the company has reached a deal with major league baseball to outfit all mlb players beginning in the year 2020, replacing majestic. this would mark under armour's first partnership with a professional league in the u.s. trying to do the math on the number of jerseys. each player gets four or five, you've got away jerseys, but regardless, it's the marketing. >> oh, it's big. nike would tell you that their deal with the nfl has been incredibly valuable.

it's a big deal. i think kevin fine is doing a lot of things right. the stock has been down a lot. some of it is because of sports authority. some of it is because -- lulu has going down because people think athleisure has had it so i think it's a smart move. >> a very smart move. >> he needs the visibility. you want to see that visibility in more than just a couple of colleges. >> very smart. >> they have got good traction in basketball, obviously, with curry. >> yes. >> trying to think about athletes they have procured in baseball. nothing comes to mind at the moment. >> no. boy, they have done a lot of right picking in golf. you know, kevin did -- in china he's doing incredibly well. he's a very competitive guy. >> it's harder to think who the preeminent ballplayer is. is there one name right now the way that a steph curry stands out or lebron stands out in the nba.

>> kershaw? >> maybe kershaw, but he's not that big a profile. >> you do want guys who play into the postseason, which he's doing. >> yes. >> he's an animal, that guy. he's amazing. maybe one of the greatest ever, kershaw. >> yeah, doesn't get talked about enough. but baseball doesn't have that following that it used to either. >> i still can't get over this jets game last night. that was -- >> if you have johnson, who just tore it up. >> it's really great being a jets fan right now. it's enjoyable. >> i don't know what happened. that's a total breakdown. you know, revis island is like gilligan's island. >> it's a total breakdown. >> total breakdown. it is a total breakdown. it's too bad because nice guys, good guys, but wow, the running game -- anyway, what are we doing? fitzpatrick has got -- as soon as the game is over, fitzpatrick is like back, back. by the way, look at this.

scott wapner has a special five-year anniversary. bryce harper is a u.n. guy and he's got a fifth anniversary and bryce harper is a guy who might regard was being pretty amazing. >> very nice. >> i watched that redskins game from the stadium there. that was a beatdown. didn't look like it. >> you guys are in it. you're in it. >> i'm in it to what? >> you've got a shot. you've got a quarterback you're going to have the next 15 years. i don't want to hear about it. >> we're a young team. it's not our year. we're a young team, we're taking no prisoners. i'm talking about the philadelphia eagles, tnp, take no prisoners. we will get -- now that we've covered sports, we'll get stock trading with jim in a moment. unh adding about 50 points to the dow, but ibm subtracting about 40.

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airlines. i thought delta's quarter was fine. what really does matter, if these companies are truly not adding capacity, then you truly will have better numbers next year. the multiples are so low, they're acting as if they'll be worse. i think the group's a buy. >> united cited the dollar, right. >> yeah. >> fewer surcharges and obviously -- >> and you're getting a little bit better as the months went on. again, look, you can't blame terrorism for heaven sake but there is a belief if you could get that transkaucontinental better, it's been horrible. >> what tonight? >> domino's. it's unbelievable. anyone that's used the app knows this is one of those that as they added things to the app, they were able to cut costs and make it so that people just order very easily. it's been an amazing story. remember, this stock was $10 when patty doyle took over. look at that, and there's a dividend too. i think if you tried one, david,

i know i got a lot of heat. people say, listen, you live in jersey. we always order domino's because there's a no cheese option, the banana peppers are great, it comes really fast and you can pay and never have to talk to anybody. that's nirvana for millenials. if millenials never had to talk to anybody, they'd be thrilled. look, they text me, they're in the house and text me. they're in the house. >> a viewer is going to order domino's and watch narcos because of you. >> the biggest day for ever for domino's is november 4th because queen elizabeth ii, "the crown." >> also a big domino's fan, the queen. they can't stop the pizzas from coming. >> domino's, take two, you don't go anywhere. honestly. they never leave the house, they never talk. we're learning a lot about millenials, they never talk, never leave the house, your verizon bill is big, they're amazing. they take over the world? these people aren't doing anything. >> we'll see you tonight at 6:00

p.m. eastern time. when we come back a lot more on this netflix rally up almost 19%. don't go away.

♪

good tuesday morning, welcome back to "squawk on the street." stocks in a mild rally mode here as virtually every s&p company that posted earnings this morning comes in ahead of expectations, at least on the bottom line. six of 11 beat on the top line. we'll watch that along with oil, relatively flat. >> our road map for the hour begins with netflix. shares surging after the company reported over 50% more subscribers than expected. the ceo says it will double down on original content. financials in focus. goldman and blackrock both reporting earnings of the we'll dig through the numbers. and we're just 21 days from the election and things are certainly getting heated. where do the candidates go from here? but we start with netflix, that's the showstopper of the morning, soaring after blowing past earnings expectations on those strong international subscriber numbers. the stock this morning is up

almost 20%. joining us on the phone is web bush senior securities analyst, michael pachter who raised his price target to $60 from $50. michael, you've been dead wrong on this stock. what surprised you most about these results? >> i mean dead wrong on the movement of the stock. absolutely right on the cash burn. so i'd say actually the biggest surprise for me is that their cash burn doubled to over $500 million. i'm even more surprised that investors seem not to care at all. reed keeps giving investors what they want, which is subscriber growth, and props to them. they're buying subscribers at a clip of negative $2 billion a year. if they don't make money, i don't understand the share price at all so i guess i just don't get it. >> jessica lessen also gets us, editor in chief of the information. jessica, there was some

skepticism going into this one, not just about the cash burn which michael alluded to, but about how fast they could grow that international number and netflix delivered. investors trying to figure out if that is sustainable. what do you hear? >> it's hard to tell. obviously it was buoyed by international subscriber growth. we saw continued the same kind of slower pattern in the u.s. reed also talked a lot about, you know, pulling back and not investing as much in china, which is obviously a big international market as well. so i think the growth for netflix and subs is a question of beating the expectations or not. i agree with michael. you know, a billion and five in cash burn a year, 6 billion on content may be going back to the debt markets. that's what i'm looking at and thinking about as well. >> michael, isn't the idea that, yes, they're spending billions on content, but if they continue to deliver that, that's the competitive edge that keeps the

subscriber growth growing and eventually if you believe reed hastings will lead to profitability next year internationally. >> yeah. i mean sara, i defy you to name a single original on netflix that they own other than stranger things that they called out yesterday. every single show you've heard of is licensed, they don't own it. so they are making a big bet that they are better than hbo and hulu and amazon and fx at developing this stuff and yet i think they completely lack the internal expertise to compete. their chris rock deal shows that they're willing to pay crazy numbers, $40 million for two comedy shows, two comedy episodes. i think they're just burning cash. it's going to have virtually no value in the future. so reed is building his future on his savvy on picking compelling content. he hasn't proven that he can do that yet. i think investors are foolish to give him that pass. >> jessica, he did get a question about competition.

i think the specific question on the call was about amazon video and he said snapchat, youtube, facebook video, all of that takes a lot of hours, probably much more than amazon so we've got tons of competition for screen time. but he says we win such a small percentage of total screen time and we're focused on our exceptional content. did he make a convincing case? >> i don't think so. i think amazon is a force in video. we've got a story coming out today with an interview with one of their senior executives, and they're winning in a lot of areas. they're getting -- they're a formidable competitor, particularly on the spending front. a spending war isn't a competitive mode around a business and that's the reality we're in in this ott market right now. >> so, michael, i mean you did raise the target to 60 from 50. walk us through your evaluation. are you looking at some of the parts and why it differs so much from goldman at 140, morgan at

130, ubs at 119, suntrust at 115. i mean you're almost half that target price. >> yes, we are some of the parts. we value the domestic business at $49. you know, we're burdening their contribution profit with tech spending, which the other guys seem to be overlooking, so the profitability is actually pretty thin. we're giving them a dollar for the dvd business and $8 for the international business. and we're just kind of throwing out a number on international because they're losing money on every single sub, so they're making up for it in volume. i think the biggest limiting factor is exactly what jessica said. amazon is serious about this. bezos was sitting at the golden globes table. he cares. they're spending as much as netflix next year. they're catching up. they're going to offer monthly prime this holiday. if consumers don't notice that amazon is cheaper and offers a better value proposition, they're pretty foolish. i think they split the market

and we have much slower growth for our price target than competitors do. >> when i hear you talking about netflix and amazon, it is somewhat reminiscent of some analysts who spoke about amazon 20 years ago at this point or maybe 15 in terms of very strong top line growth but always questions about their ability to deliver on the bottom line. i know there are differences amongst the two companies, but will you admit that they did eventually make it work and start to deliver on the bottom line as many people think netflix will too? >> amazon has $130 billion in revenue and is spending about $5 or $6 billion on content. netflix has $12 billion in revenue and is spending more than half of that on content. amazon can outlast them forever and bezos is a tough guy. he is dr. evil, he intends to take over the world. he's going to succeed. >> we'll leave it there. michael, thank you very much for making your case here. michael pachter of webbush with a $60 price target on netflix.

jessica lessin, we'll look for your article out. >> dr. evil, he's going take over the world. blackrock reporting earnings of $5.14 a share. they have been looking for a flat $5 a share. revenue was a bit below what was anticipated, $2.84 billion. larry fink spoke this morning on "sidewa "squawk box." >> it's a tough environment because it's really tough for our clients. as i said, low interest rates, lowering expected returns. people are lowering their long-term return targets. so you're going to see many pension funds in the course between now and year end lower their return from probably a 7.5 to 7, maybe even in the 6 handle. >> they did exceed $5 trillion in assets under management at blackrock. take a look at goldman sachs shares, up about 2%. the company handily beat estimates on both the top and bottom line. quarterly profit rose 47%.

revenue up to $8.17 billion from $8.16 billion a year earlier. goldman's strength particularly in fixed income, currency and commodities. if you take out a dva from last year, in other words, an adjustment in terms of the value of debt, they were up 49%, guys, year over year. that was at least by many measures the best performance we've seen year over year in what has not been a bad quarter thus far for financial institutions. jpmorgan, citi, even b of a yesterday all reporting very respectable if not strong trading, particularly in fixed income. but that had not been enough to sustain the shares of any of them over the course of the days in which they reported earnings, having begun those days up only to end down. >> is it that investors have been through this dance before. there's good quarters and the ten-year yield peaks out at 180 or whatever and the fed is on hold even more and they get

burned, regulation. >> given all the fwatalk about december hike, banks in particular. but they were strong, no doubt. roe, returns on equity about 10%. >> first double digits since early '15, believe it or not. it's been a long time. coming up tomorrow we are going to speak exclusively with goldman sachs' ceo, lloyd blankfein, first opportunity to talk to him after those earnings from this morning. when we come back, the head of the largest real estate platform in the world, blackstone's global leader jonathan gray is with us after the break.

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with more than $100 billion under management, blackstone's real estate arm has grown more than 30% just over the last two years and has solidified its position as the largest real estate platform in the world. john gray is the global head of real estate at blackstone and joins us from boston. at forbes' 30 under 30 conference. john, you are a young man, to be sure, but you are not under 30, so why are you there? >> yes, i definitely don't

qualify, david, either for age or my outfit, which certainly isn't hip enough. i'm here on behalf of the blackstone charitable foundation, whose sole mission is empowering and training entrepreneurs. we brought 20 groups of students from around the country and ireland to come here to learn to compute, to network, and some of the ideas are incredible. one of them is a mobile app to help produce drunk driving. another one separates dirt and water from petroleum. a third one innovates with new shoe laces and we're here to help them. people are negative about the economy and the world. you spend some time at a conference like this with kids like this and you feel very optimistic. >> well, i've not known you to be particularly negative and have been rewarded for not being negative but let's start on your view of the world. you guys bought stivis not too long ago, one of the largest

complexes here in new york city. rates are going higher, that is interest rates, and rents seem to be stabilizing if not falling a bit in new york. is that concerning to you when you see flattening rents here in new york and does it actually have ramifications more broadly? >> well, i think in new york there has been a little bit of a burst building in terms of the apartment sector, but mostly at the high end. what we've seen at stchivis is pretty strong demand. in new york city new supply is not an issue and that's pretty similar with the rest of the country. we have an economy growing sort of 2% a year, new supplies only growing about 1% a year and that's why across the board we're generally seeing rising occupancies, rents and cash flow. so we're later in the cycle, but some people i think are starting to get a bit too negative. >> they are. why are they getting a bit too negative? >> well, i think there's a lot of focus around interest rates,

and there's a sense that owning real estate is the same as owning a bond. the two are actually different, right. real estate like stocks can see earnings grow and that's what we're seeing because of growing incrementals. in the mid-2000s, all periods when rates went up, real estate did okay. we don't expect to see the growth in value the same as the last four or five years but we don't expect to see a sharp decline in the near term. >> it occurs to me you may have a decent view as well sort of of the nation as a whole given invitation homes, the company that owns more single family homes than any company in the country. what are you seeing there in terms of people's ability to pay, in terms of the rental market overall for these homes, so many of which you bought over the last let's call it five to

seven years? >> yeah. well, the housing market is definitely a bright spot in the u.s. today we're only building about a million one homes. we probably need a million five or six to keep up with population. as a result of that, you're seeing rising rents, you're seeing rising home prices. and we expect that to continue. i think that will be a positive for the economy going forward. yes, there are challenges in terms of affordability and access to credit, but overall, the shortage of housing is forcing rents and home prices higher. we expect that to continue. we own about 100,000 either multi family rental homes or single family homes for rent. across the country we're seeing strength in that area. >> what is the future for invitation homes? are you going to take it public next year? i notice amh is up about 25%, that being the stock this year. it would seem to me that it might not be a bad time to monetize some of those

investments. >> yeah, i can't talk about the specifics on invitation homes but i can say we've said publicly in the past at some point we will look to exit and with a company like this, the public markets i think would make sense. >> i wanted to ask you, jon, about a different part of the world, the uk. i know you took some markdowns earlier in the year on the portfolio after brexit. what is the uk and european environment look like now? and are we at the point where there's some interesting opportunities as a result of that massive depreciation of the pound? >> yeah. well, the uk has definitely taken a hit. i think when you look forward, we're long-term positive on the uk but i think growth will be a little more challenged over the next couple of years. when you think about the impact particularly to financial services firms and a lot of companies who are being more hesitant, that has to translate into a little abit lower growth. on the positive side you pointed

out the pound coming down, interest rates coming down in the uk. that's been helpful. so i think it's a story where growth will be slower. if opportunities emerge, we would definitely look at them. right after brexit we bought a bunch of logistic assets we thought were priced attractively. we're looking for things there and the next couple of years i think could be a little bumpy in the uk. >> we could go a lot of places with you, jon, so the next one would be hospitality. hilton, you're still a very large shareholder, that being blackstone. i think the last time you sold the stock was close to 30. are you guys not selling right now? because there are a few who believe, at least, that fundamentals in the lodging business are starting to deteriorate. >> well, again, i'm not going to talk about specifics when we're selling/buying. i think we've shown ourselves that when we believe in a business, we can afford to be patient, sell when we think we're getting appropriate value.

in the case of hilton, both the short term and the long term i think are pretty positive. you have a split coming up into a time share, an ownership company and an operating business. i think that will be helpful. and when you look at the growth of the business over time, it's pretty powerful. today hilton represents about 4.5% of the hotel rooms in the world and it represents close to 20% of all the hotels under construction. we think this is a business with a bright future. of course as we do with all things in our closed ends funds, when we feel the price is right, we will sell. >> some say there's a lot of new supply coming into the market, there's a slowdown of corporate travel, you've got the likes of airbnb which is taking a small percentage but not insignificant percentage of business travelers right now. why is that a good landscape? >> well, it's not a great landscape in terms of, yes, we've seen revenue growth in the industry slow from call it 6%,

7%, to 2%, 3%. so there's less growth than there was. but, david, the stocks have reacted to that as you pointed out, so the industry has seen the stocks decline 30%, 40%. so the market expectations i think are much lower for these companies and it is possible that at these valuations they could outperform lowered expectations. that's -- when you look as an investor, it's not only are the prospects for an industry good, but what's priced into it. i'd say investors today are pretty sober around the lodging industry. >> jon, there's always so of other things to discuss but we're out of time this morning. always appreciate you taking some time to join us. thank you. jon gray. >> thank you, david. take care. as we head to break here, take a look at shares of united continental. they're up about 2% after the company reported earnings that beat the street. you'll hear from the ceo straight ahead when "squawk on the street" comes right back, with the dow up about 60 points. .

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united airlines reporting earnings and revenue that beat the street. our phil lebeau sat down with an

exclusive interview with the ceo, oscar nunez and we're looking at all of the airlines doing quite well in today's trade. >> they're all moving higher and this started with delta last week who said they're going to pull back a little on their capacity. united following through with that and in the earnings last night basically saying we can improve that passenger revenue and we're moving towards break-even passenger revenue. that's why when you look at the third quarter performance, yes, they beat on earnings. they also had better than expected revenue. what stands out is the fact that that passenger revenue, while it was down 5.8%, they are improving and moving towards break-even passenger revenue. like delta, they're not committing to an exact time frame for when that will happen. that pretax margin of 15.8%, that's an improvement but they still lag some of their competitors. we talked with oscar about that today and they said overall they're moving in the right direction in terms of their financial performance. >> there's been a lot of push to accept the fact but we don't

adhere toblgt policy. i have a new leadership team that's outstanding and to unlock our potential in essence has been our terminology, we see the possibility of being the best airline in the world across all facets. >> and that means driving higher revenue, part of the reason they brought in scott kirby to work on that specifically. that's a big part of improving those margins. take a look at united versus american versus delta. what you notice here over the last year, that's united in white there. they have had the best performance and i know people will look at this and say, look, they're still down and this market is up overall. they have come back along with the other airlines, sara, fairly substantially since july. and the belief in the industry is once they can hit break even on passenger revenue, then they believe that the shares will start to move even higher. >> phil lebeau, a busy morning. thanks so much, phil, talking some airlines. when we come back, election

day 20 days away. we're going to hear from some top advisers about what moves the candidates should make ahead of the debate this week. take a look at where stocks are trading. the dow is up now just 56. back in a minute. guess what guys, i switched to sprint. sprint? i'm hearing good things about the network. all the networks are great now. we're talking within a 1% difference in reliability of each other. and, sprint saves you 50% on most current national carrier rates. save money on your phone bill, invest it in your small business. wouldn't you love more customers?

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so your business can get back to business. sounds like my ride's ready. don't get stuck on hold. reach an expert fast. comcast business. built for business. good morning. i'm susan li and here's your cnbc news update. a major battle is under way in the fight against isis. american forces are helping iraqi troops take back the city of mosul, which has been a stronghold for the terror organization. the offensive is expected to last weeks or longer and the u.n. says the fighting could drive a million from their homes. a new class action lawsuit has been filed in connection with the flint water crisis. in a release, the michigan aclu says that it's seeking damages on behalf of flint families. hundreds of other lawsuits have already been filed, including one against the state's governor. 65 million americans are going to see a small bump in

their social security checks next year. the government is raising benefit payouts by 0.3 of 1% which is just around $5 for an average retiree. recipients saw no cost-of-living increase this year. ♪ yes, tupac shakur, one of naen artists up for sbukz ininductio the rock 'n' roll hall of fame. the inductees will be announced in december and frankly it's just about time. that's your cnbc news update for this hour. back to you. >> all right, susan, thank you very much. exactly three weeks from today polls will finally turn into votes. gop nominee donald trump continuing to cast doubt on the election process, pushing that rigged election rhetoric. and in wisconsin last night stepped up attacks on hillary clinton over the wiki e-mail leaks. take a listen. >> this magnitude is worse in my

opinion and in the opinion of many people in law enforcement, this is worse than watergate, what's going on with this. and what does she get out of it? she gets to run for the presidency of the united states. explain that. explain that. but we're going to put an end to that on november 8th. >> we're joined this morning by veteran political strategist kristi setser who served as a senior advisor to the al gore, howard dean and chris dodd campaigns. also former romney advisor and advisor to governor mike pence, phil russer. the sustained drip of news from wiki, from the fbi documents, how much does that at least dampen enthusiasm for clinton or maybe push some progressives to the likes of a jill stein? >> i'm not sure that it does. look, to the extent that all of the media attention for the last at least week has been on donald

trump and these allegations of sexual misconduct, i think that what that means for the clinton campaign is the spotlight is not on them and so people really can't hearing so much about wikileaks. to the extent that it might matter, honestly i think she has coalesced a lot of that vote that might have gone to bernie sanders before and might be thinking about jill stein. i think at this point she's got something like 90% of the democratic base vote. those aren't people that are going to go i think anywhere else but her right now. >> phil, you make the point that whatever is in those documents that we've seen or will still see, that voters have almost become numb to shock. things that would have been shocking are just not shocking anymore. >> i mean the right quid pro quo in government e-mails would of its own light in any normal year be an october surprise of enormous magnitude, right? we're just not seeing that because of the daily drip, drip,

drip of both wikileaks, the trump campaign's pronouncements du jour, so it's hard to break through. but the trump campaign would be wise and i think they are to really focus on this issue because this is an opportunity to pivot and point out the rigged nature of the system as opposed to going to the electoral vote process where there's no evidence. and then pivot it to lay out kind of the core argument for trump on how he's going to make america great again. if he can prosecute those two fronts tomorrow night, that will likely be the foundation of what will be an important last chance for him in front of the american people. >> then, phil, why the emphasis on fraudulent registration, right, telling voters to beware of fraud at polling booths. no matter what kellyanne conway says or today what chris christie says. >> to be totally honest with you, carl, i'm not sure that's where the focus should be. you know, if i were advising donald trump on a daily basis, i'd be focusing on hillary

clinton and the wikileaks and the quid pro quo issue and be using that to pivot to talk about his economic agenda and how he's going to help all americans. i don't think there's the evidence to support claims that the election is rigged. and it seems to me out of sequence. >> does it resonate at all, christy? the sbintegrity of our voting system? there's the potential for voter fraud, for ballot counting. we've seen this in the past with florida. >> right. it's extremely, extremely, extremely overblown. we talk about words like vote fraud of something like one billion votes cast, there's maybe been 31 instances of in-person sort of voter fraud. so this is basically really a solution without a problem. the real problem for donald trump in bringing up this talk is of course that it depresses the very people who he wants to bring out to the polls. if you think the election is rigged, then why in the world would you come out and vote for someone? so he's actually very much at

odds right now of course with his advisers. i'm sure that if phil were advising donald trump, he would tell him to be focusing on those things and i'm sure that he would be just as frustrated right now as i'm sure kellyanne conway and some of the other trump advisers are, because he clearly seems to not be focusing on the messages that might in fact make him much more competitive. right now clinton is in such a dominant position that she's frankly more likely to win texas than trump is to win pennsylvania. it's not even a fair fight right now. >> if you're talking to someone who is literally counting chads in 2000 in florida on this show right now, i was there. you know, election fraud is important. it does matter. but it seems to me to be out of sequence. we have a bunch of time to go. frankly most of america, about half of america will have voted by november 8th. that's an important fact to realize. we'll start to understand with more granularity what those trends and details look like in some of those swing states. but the fact is donald trump remains very, very close to

hillary clinton in a lot of swing state polls. frankly the down-ballot right now is completely schizophrenic. there's separation between how people are viewing trump and how they are viewing republican members of the house and senate. i wish there was an etf for holsthol pollsters, i'd buy it. >> so much has been written about clinton trying to keep her schedule light, trying to avoid unforced errors. are dems nervous about the next 20 days? >> no. i think for once they're playing it exactly right. they have really been in the cat bird seat for the last few weeks here. i think what you're going to see tomorrow night is some combination of what she did in the first debate where she was a little bit more on the attack and in the second debate where i think she pulled back a little more and sort of let america see donald trump in all of his glory. i think you're going to see something in the middle there. she's probably right, right now to keep a lighter schedule and

let the focus be on trump because i think the calculation there is that the more people see him, the less they like. look, i'm from suburban philadelphia. that's a swing district within a swing state. that's where bill clinton is actually campaigning today. and i think, you know, the vote there, they're the people who are for whom when they see trump, they don't necessarily like him and that is what's helping clinton right now. >> christy, phil, thank you, guys. 20 more days and then we'll talk about something else, perhaps. >> we're ready. >> make sure to tune in today 4:00 eastern time, we'll be joined by democratic vice presidential candidate, tim kaine. tomorrow night we'll have coverage of the third and final presidential debate at 9:00 p.m. eastern time. sticking with politics here, our john harwood sat down with senator chuck schumer and got his take on immigration, infrastructure, tax reform and much more. john joins us now. >> good morning, sara. with three weeks to go odds

favor hillary clinton and democrats recapturing the majority which would make chuck schumer the senate majority leader. i asked him about things after this very acrimonious election that he might be able to work with republicans on and what happens if he can't. >> the two things that pop to mind because schumer, clinton and ryan have all said they support these are immigration and some kind of international tax reform tied to large infrastructure program. if you can get overseas money to come back here, even if it's at a lower rate than the 35 it now comes back at and you can use that money for major constructive purpose such as infrastructure, if you did an infrastructure bank, for instance, you could get $100 billion in equity in the bank and get a trillion of infrastructure. >> a permanent lower rate, not awe holiday rate. >> yes, you can't do a one-shot deal. >> if you encounter a situation where you can't get 60 votes for a supreme court nominee for a president clinton, would you

consider changing the rules? >> i hope we won't get to that and i'll leave it at that. >> now, there's still some business that might get done in a lame duck session of congress later this year, especially important to the business community is president obama's priority of the transpacific partnership. i asked him if that could pass. >> there's only one person who will decide that, just one, mitch mcconnell. if he puts it on the floor, it could get done. >> merrick garland, do you see the republicans if hillary clinton wins the presidency going ahead and putting him up for a vote and him being confirmed? >> again, i don't know what mitch mcconnell will do. but i'll tell you this, a lot of it depends on the election votes. if hillary gets -- it's more likely he'll do it than if she wins by a narrow margin. he wouldn't do it if trump wins

or he has the majority, either one. >> here's one thing that is not likely to get done from chuck schumer's comments and that is a grand bargain on the budget. i asked him if democrats would ever go along with curbing entitlement programs. he said as far as cutting benefits, i'm not interested a bit. guys. >> yeah, the democratic position. john, which senate races are the closest right now? which ones are you watching as hillary clinton maintains her lead here against donald trump? >> democrats need four seats to get a majority. if hillary clinton wins, five. if trump wins, we believe that ron johnson in wisconsin and mark kirk in illinois are likely to lose. that's two. then you've got pat toomey in pennsylvania trying to hold his seat and kelly ayotte in new hampshire. they're both in trouble. those are potential pickups. then you have richard burr in north carolina. that is where where he is in danger in what's traditionally been a red state. even roy blunt in missouri has a

real challenge on his hands, so democrats have some possibilities. the one possibility for republicans to pick up a seat is the seat of retiring senate democratic leader harry reid, who chuck schumer would replace. joe heck is running for that seat. he's a congressman and he's got a good chance to win. >> all right, thank you, john. john harwood. as we head to break, take a look at shares of harley davidson reporting earnings in line with estimates, but the motorcycle maker also announced the reorganization and job cuts to deal with what it says was slowing sales. plus tomorrow, don't want to miss we'll have an exclusive interview with goldman sachs' ceo lloyd blankfein. of course that bank reporting earnings this morning and its stock is still up. in fact about 1.5%. we've got a lot more on "squawk on the street." stay with us. guys, what's happening here? hey nicole, this is my new alert system for whenever anything happens in the market. kid's a natural. but thinkorswim already lets you create custom alerts for all the things that are important to you.

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welcome back. markets are higher although losing a little momentum but health care is standing out as the best performing s&p 500 sector. ensure united health group adding most of the gains. shares are surging more than 6% on the heels of that strong third quarter profit report. other leaders include illumina, anthem and endo international. nearly every member of the sector is positive but health care is negative for the year, down about 3%. the worst performing sector in the s&p 500, sara. back over to you guys. >> they have been hit especially hard in the last few sessions. now let's get over to the cme group. rick santelli. >> good morning, sara, and thank you. i'd like to welcome my special guest, judy shelton. we're going to have a little time delay so i'm going to frame up the first question. you know, democratic outcomes

are not in vogue. whether it's voters in this country or voters on the referendum they called brexit, the imf, the fed, the ecb, the u.n., they all tried to address the credit crisis and a healthy environment thereafter. it hasn't succeeded very well. now they're blaming the fact that voters just don't know how to deal with this, it's their fault. it's the trumps, it's the brexit voters. democratic outcomes. judy shelton, what's going on here and why is this blame all of a sudden transferred when that growth never materialized that all these entities have promised? >> well, the whole point of democracy is that people are able to register their feelings about how things are going and to choose a better path. and what we're finding is, and i think donald trump deserves a great deal of credit for this, is that a very important aspect of our poor economic performance is a result of the monetary

policy that the federal reserve has been imposing, and it's been great if you're a wealthy investor or a corporate borrower or big government, but it has been very hard on everyday workers who find they get next to nothing on their savings and their pension funds are now in danger. >> now, when i look at today's news, and there's a lot of these stories out. mp try to railroad brexit in debate about second referendum. in the beginning it was this referendum doesn't matter, may really insisted it did. this is the same dynamic whether it's the tea party, whether it's trump, whether it's brexit. this is the same vein of discontent, is it not, judy? >> well, i think that what people resent is this idea that seems to be held by what i will call the global financial elite that they know better than voters. they know what's good for them. and i think people resent that this group of central bankers and the finance ministers of the advanced countries and the wall

street titans and the big banks, they all seem to know what they want and things have worked out pretty well for them. they have access to very cheap funding. but those benefits have not really trickled down. if you just are an entrepreneur and you want to get a loan at your local bank, you don't have access to that cheap money. it has really been a form of monetary favoritism. and mr. trump has focused on it and he's dared to be critical of central banks and particularly our federal reserve. 7. >> judy shelton, thank you for being our guest. this isn't an endorsement of one candidate or another, but it definitely shows that voters have an opinion, and i think some of the politicians they put in office should respect that. thank you for taking the time today. sara, back to you. >> rick, thank you. now let's send it over to john with a look at what's coming up at the top of the hour. >> well, it's official. stranger things have happened. netflix up 18% on better-than-expected subscriber

numbers. we'll dive further into that. also ibm earnings and what intel is coming up, and that stock is at a ten-year high. you've heard of uber and lyft but have you heard of juno? we'll have that and a lot more coming up next.

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built for business. reviews for googles first phone, pixel, is out. wire says you should get a pixel. tech crunch labels it android's best ambassador. joanna stern, wall street journal and usa today's personal tech columnist. best android phone on the market? >> definitely. in large part thanks to exploding note 7s. >> makes you wonder what would have happened otherwise. >> it would have been a close call. >> it looks exactly like an iphone. good for iphone users. but the hardware design is great, right? this is what google was really trying to do here, take away any other arguments about getting an iphone.

make the hardware just as good as apple does and focus on the software experiences. try to bring over those people who love using google software experiences. they do a really good job of that. >> we'll talk about the ecosystem in a second. for the hardware alone, ed, what's your take? >> it's a winner. terrific camera phone. iphone 7 plus is a terrific camera. samsung galaxy s7 had a great camera. so did the exploding note 7. we know what happened there. it feels like a premium device. >> a lot was made, joanna, at the announcement about assistant, ai that's built in. how did that stack up? >> siri looks pretty stupid today. i think siri looked pretty stupid yesterday. she looks stupider today, or he. no sex assigned. >> what about alexa? >> a different type of assistant and google will go after alexa

with the google home products. it's on the phone and is with you. alexa makes it more comfortable for to us talk to alexa. she's always listening, very fast to respond. google has done a lot of that here too. fast to response, quick to respond. understands what you're saying. >> your argument for what you're not -- i message is the reason you're till? apple system. >> i love this poen but it's really hard to go to this phone when all my other friends and family have iphones. >> right. where is the wall now? what's keeping people within a system when we know the retention is still so high? >> i think you hit it. you get sucked in on a particular feature or the ecosystem broadly. google photos. you can have the pictures on your iphone on google photos. we have our pictures there, music there. >> or your family. >> or your family.

that's right. it's hard to get that inertia, i can get it over here but i'm comfortable over here. >> it's the hardware, too, right? apple has the apple watch, mac products, apple tv. this whole ecosystem of devices. google is trying to do the same thing, wifi router, chrome cast, google home speaker. the decision we'll start making as consumers is not what phone do we have in the pocket. it's what system do we have around us, what services connect all of those? >> joanna in your piece you sort of ask an interesting question. that is why now? why is google making this pixel now? what sort of opportunity does it see? it seems late to go after the iphone in such an aggressive way. did you figure it out by playing with the phone? >> a couple of things are at play. the services. google has always been best at services, software. they see now we have to control the hardware because our partners don't do it well enough. right? take aside the samsung blowing up. it's been their leading partner.

it's good but it's not been great. when you sort of look what samsung sells the most of, it's more lower end phones. clearly apple wanting to go after the iphone and a higher end part of the market. you have to look what happens to apple. apple says every year or every quarterly earnings that they're getting a lot more people coming from android. that is a threat to google. >> isn't the larger lesson here, hardware is being xhodize icom, right? >> artificial intelligence. vr. day dream, the upcoming vr system that google has coming. that will compete against samsung's gear vr. so, yeah. it's a new ball game. it's not just about hardware. >> fascinating. good to get your take. ed, thank you so much. joanna. joanna stern and ed baig. >> does it come in rose gold? >> it doesn't.

it comes in blue. >> that's interesting. that does it for us on "squawk on the street." on "squawk alley," netflix driving up the stock nearly 20%. plus a great guest, vice chairman of lionsgate, michael burns. )all right, be cool. you got the amazing new iphone 7 on the house by switching to at&t... what??.... aand you got unlimited data because you have directv?? okay, just a few more steps... door! it's cool get the iphone 7 on us and unlimited data when you switch to at&t and have directv. 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.

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good morning it's 8:00 am in california and it's 11:00 am on the east coast. "squawk alley" is live. ♪ joining us from palo alto, roger mcnemie. good to see