good morning. it is 8:00 a.m. at snapchat head quarter out west. it's 11:00 a.m. on wall street, and "squawk alley" is live. ♪ ♪ ♪ good wednesday morning. welcome to "squawk alley." joining us, as always, jon fortt, kayla tausche and myself

at post 9. also today, the president and ceo of the aspen institute, walter isaacson. walter, good to see you again this morning. >> good to be back with you. >> our top story today, one we've been following pretty much all week. that is the moment of truth that social media is going through following donald trump's presidential win one week ago. in the last 24 hours, twitter has suspended a number of accounts associated with the alt-right movement just as it announced a new effort to crack down on hate speech. and in the fight against fake news on social media, tech executives from alphabet to linkedin say mistakes were made and the valley has to do more. >> at google, we've always cared about bringing the most relevant and accurate systems to users and that's where almost all of our work goes at the end of the day. when i look at it, it's important to remember, we get billions every day. there have been a couple of instances where it's been pointed out and we clearly did not get it right, and so it's a learning moment for us, and we will definitely work to fix it.

>> walter, without turning into a brainy, sort of thought piece about the ethics of journalism right now, this is important stuff, right? trying to establish some standards by which a viewer or a reader can know this is for real. >> yeah, sometimes wonder, you know, carl, whether humanity can survive the internet. it's been such a wonderful 20-year, 30-year run on the internet, and now you see the proliferation of fake news, hate sites, that sort of thing. one problem is, you know, in the old days you had telephone companies and common carriers akkad anybody could say what you wanted on phone, and you had newspapers that were filters. and if you wrote a letter to the editor, they'd decide whether to print it. now it's hard to say you're publishing fake news, we're not going to let you through our platform on the internet. i do think that customers are going to value, knowing what's

true or not, and eventually, this will sort out. >> but there are a lot of levels of truth, walter. and i want to use a specific example of an article floating around facebook in just the last 24 hours from a site called soakitin. it says "trump brings ford home from mexico." it says "ford's heavy-duty pick-ups were being manufactured across the border in mexico, but this week they are bringing them home. this is great news." it's not exactly untrue. ford did bring f-650 and f-750 production back to ohio, but it was as part of a 2011 agreement with the uaw. and i'm just wondering, how if you are facebook, you decide whether that story is fake or not? >> you can't. and that's the problem. this is not one with an easy solution. there are all sorts of shades of truth. and frankly, i don't want anybody, whether it's facebook or, you know, cnbc, telling me this is the only type of news i

can hear. i want to have a wide range of choices. that said, it's useful to have humans in the equation to be able to debunk stories and to say this is not something we're going to feature because it's not really true. >> walter, all shares are kind of treated equally right now on facebook when it comes to news. i mean, something from a news outlet that's been around for a couple hundred years and has, perhaps, more established standards, is treated the same as some blog that was perhaps just created a month or so ago somewhere else. is perhaps one answer to have some sort of identification of what sort of a source the information is coming from and what sort of a reputation it has for journalistic accuracy? of course, that would throw a lot of traditional outlets into perhaps questionable waters, but it might inform the user. >> well, as you said, as you got near the end of the question, it sounds very reasonable until we try to figure out how to do it.

i'm going to say something that will get me abused in the twitterverse, but i trust "the new york times," generally. but there are people who think "the new york times" is untrustworthy. it's kind of hard, even with a very established place like that, to say it's trustworthy. that said, one solution is have the algorithms right so that if other people online are trusting it, it gets more and more of a reputation. that's what google has built up over the years, even though it has made some mistakes recently, which is, if more and more people point to it, then that sort of indicates it's more trustworthy. on the other hand, in the old days, a you remember, yahoo! when yahoo! did yahoo! news, actually had real apertures and real humans. and as much as we think machine learning and artificial intelligence and algorithms can sort out the wheat from the chafe, it's actually something human judgment is better at. and i would think we might want to go back to having some more

humans in the loop here making judgments about whether a story is right. that's what you do on your show. that's what happens in your control room. and you know, that's why people when they really want to buy or sell stock, they're not going to some wacky, fake news site. they're going to cnbc. >> right. >> or for that matter, to jon fortt's podcast. i just listened to it. congratulations. >> thanks, walter. >> it does bring -- as if that weren't enough, facebook has uncovered more miscalculated metrics related to ads users see on their feeds. the stock's getting hit this morning potentially on that news, down about 0.5%. julia boorstin's out west watching this round. hey, julia. >> reporter: hey, carl. that's right, facebook saying it found three more metrics that it overstated and one that it understated for brands. now, facebook announcing this morning that it has uncovered more of these miscalculated metrics related to how users see brands and different statements from ads on their news feed.

now, of course, this does not affect facebook's rev nooi thank you. it's not about the app, it's about the brand presence, as the metrics facebook's used to charge advertisers aren't changed, but the mismeasurements are significant. facebook says the number of people who see a publisher's page over the course of a month may now shrink by as much as 55%. and facebook estimates that the organic reach of pages will be 20% lower on average as a result of these recalculations. now to reassure advertisers, facebook is announcing a number of changes in partnerships to improve transparency, such as increasing third-party verification of its metrics, working with the likes of neilsen and comscore, also announcing it will create a measurement council with marketers and agencies. mkm analyst rob sanderson saying "we doubt there will be significant financial repercussions as the ad performance is what it is regardless of stated engagement metrics and the advertising community in general is positive on facebook. it is, however, an embarrassment for the company in an otherwise

strong reputation with advertisers." now, michael kassen, ceo of medialink, a cultancy for ad agencies and cmos says advertisers are reacting positively to facebook's efforts to improve measurement and transparency, saying that while they're not happy about the revelations of more mismeasurement, they won't hurt facebook's revenue. now, facebook tells us there was no revenue impact of the overstatement of video views, which it reported back in september. we'll have to see if the announcements of these new transparency measures can overcome advertisers' annoyance and can be a game-changer for unlocking what's been called facebook's walled garden of data. guys? >> julia, thank you for that. our julia boorstin. walter, we spoke with facebook's sheryl sandberg about this issue when it came up back in september. take a quick listen to that. >> we can never promise that there will never be another mistake again, but we certainly do all we can to get all our metrics right and really work on measurement. the most important thing to our

clients is that we measure all the way through the sales. when you think about what advertisers have looked for and measured, what they've always looked for is how they're spending their ad budgets and then is that moving products off shelves. >> so, is it a black eye, walter, or is it part of the age-old battle and challenge of trying to deliver reliable measurement? >> i think it's part of the age-old challenge. and i'm going to defend facebook a little bit. i was on last time this happened in september. we kept saying they had to go more and more to third-party measurements, be open and transparent to the neilsens and other ad-measuring agencies. this does not look like it was an intentional mistake. it certainly didn't affect ad rates at all. they even undercounted the number of times people had gotten to the very end of a clip that they were viewing, and it was facebook that came forward and said, okay, now we've discovered these things. we were counting, you know, the accumulative amount of things

when we should have been counting just the total audience. so, i think that they're trying to get it right, and we're in a new age here, and they're being open and honest. they're the ones who revealed this information. >> but walter, the thing that really leaves a sour taste in my mouth here is facebook right out of the gate was touting how great it is because of its targeting and all these things, engagement being one of them. the video views up front, a number of competitors raised questions about the way that facebook was counting video vew views and facebook kind of steamed right through them. now after they've kind of cleared the field of all those competitors, they're saying, yeah, we were majorly overstating a lot of this stuff. for a company that gets so many things right and is raking in all this cash, to get these kind of engagement metrics wrong, it certainly makes me wonder if we can believe them the next time they launch a product and they give some grand announcement about how well it's doing. >> yeah, i think you're right to say sour taste.

i just don't think it's, you know, a body blow to them. i don't think that they were intentionally being dishonest here, and i think that's one of the metrics we have to use is to say did they actually try to get this right and made a mistake, or were they intentionally overstating things? and i think it's the former. i think it was a mistake, not an intentional deceit. >> meanwhile, multiple reports this morning that snapchat's parent company, snap, has confidentially filed paperwork for an ipo that could value the company as much as $25 billion. could be one of the most high-profile stock debuts in years, although cramer this morning seems to think these numbers are low. >> well, especially given how few ipos you've had and how much money asset managers have wanted to put to work in the ipo asset class with nothing to invest in. we told you a couple months ago that goldman and morgan stanley would be co-leading this ipo with a slew of other banks involved as well and that they would confidentially file before the holidays, not only before the holidays, but we've since

learned they filed before the election to avoid some volatility, although it will be interesting to see what effect, if any, the changes at the s.e.c., which is where you have to file your ipo paperwork with, will impact the outcome or the timing of this. currently, i'm told by sources, think end of first quarter, beginning of second quarter. valuation between $20 billion to $25 billion, at least initially. every company that goes out wants to go into a market, carl, where there's low volatility, high expectations, and people bid up the price. and you get to say, we're going to raise more and at a higher price than expected, but it's just so impossible to predict what the market will look like come march. >> yeah. walter, you have a discerning eye when it comes to technology and new platforms. are you impressed with snapchat? >> yeah. thanks for saying that. one of the things that's impressed me recently is just even a little thing like the name change, where they're starting to call the company snap now, because it's much broader than just sort of quick

conversations that disappear. and to me, the ultimate test of a company is a tech company like this, is not just do you have a cool service, but do you have a platform upon which other people can build good products and good services? that's, of course, what made the iphone so great, is it became a platform. i think what they're doing with snap now is making it a platform, just like facebook tried to be for gaming companies, but they have to be a reliable platform. >> but walter, it does make you wonder how well the company will be able to diversify away from just its core ephemeral messaging service it's been known for for the last couple years. they've had to fix it several times. now they're pushing into hardware, which i'm sure is costly. we'll see how costly in a few months. but how well do you think the company can convince investors that there's more to this platform than just messaging? >> well, that's the core

question. and you know, this notion of getting into hardware i'm sure unnerves a few people. but when you get into being more than just that sort of quick messaging thing, that's when you have to execute. that's when you need real competence. it will be good. over the next two months, investors are going to get to see, is this a company that can really execute? and i think it can. it's got great leadership, got a great board. but you know, is it a company that can really execute on great, new product, or is it really just that flash in the pan messenger service? i think it's the former. i think they're broadening out, and i think they will let other people turn it into a platform for other people's ingenious ideas. >> well, they certainly knew their own worth when they turned down that $3 billion from facebook, walter. good to see you again. thanks so much. walter isaacson joining us this morning. when we come back, the internet association, which represents companies like google, facebook and amazon, has sent a letter to president-elect

trump, discussing among other things one very unlikely issue -- immigration. the ceo of the internet association is next and we'll go live to the l.a. auto show, talk to the president of audi america. and then later, highlights from our exclusive with ge's jeff immelt yesterday. we'll get his take on tax reform and if he has any regrets parting ways with ge capital when we come back in a minute.

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the internet association, which represents tech giants like google and facebook, penning an open letter earlier this week asking the president-elect to leave internet regulations untouched. it says "from standardizing data security and breach notification to protecting encryption standards across digital technologies, leaders in public office must recognize the importance of the internet as a place where people can share their information and ideas and start and grow their businesses from anywhere in the united states." michael beckerman is the president and ceo of the internet association and joins us now. michael, good morning. >> good morning. >> you touch on a number of subjects in this letter, but at the very end you talk about a 21st-century workforce -- science, computer science, education, immigration reform. interestingly, you don't ask for lift on the h1b visa cap, which eric schmidt has recently mentioned and which struck me as something you're not likely to

get from a president trump. why didn't you ask for that? >> no, we do support h1b visa reform. it's incredibly important to our companies and i do think it's something that we can get. i think if you look at the campaign and what's likely to happen with the republican congress, they'll probably tackle border security first, but after that, we do think there can be reforms in the high-skilled piece of immigration. >> so, immigration and encryption seems to me to be two hot-button areas. i mean, people who seem to be close to donald trump -- rudy giuliani included -- seem to be along the lines of, hey, tech companies, you need to do absolutely everything you can to give us access to devices like this iphone in the san bernardino terrorism case that the government wanted access to. don't you expect a trump administration to take an even harder line on that? and how do you expect to find compromise? >> we'll have to see. i mean, we're dealing with a blank slate. i should note that that's very similar to where the obama administration is and was and likely where the clinton

administration would be. it's incumbent on us to educate and work with the white house to make sure that they understand that we believe that encryption is part of our safety and security. if you weaken encryption, you're giving more tools to the bad guys, and we can't have back doors that anybody can use. and so, we'll work with the white house to make sure that we get our message across and can work with them on this. >> there's a section in here on the sharing economy as well, and there's a study out, i believe from jpmorgan, recently showing that actually a number of sharing economy workers are dropping out of those jobs, despite the flexibility, if they have any kind of a better offer. what is it going to take for that sharing economy to continue to expand and perhaps do better under a president trump, and what are you asking for? >> yeah, i mean, the story of all of our companies in our industry as a whole is permissionless innovation, and nowhere else is that more clear than when you look at the sharing economy companies, companies that need access to markets, which i think they'll be getting, even more so now maybe under this white house. and when you mention the labor issues, people are working for

themselves. really what you're seeing is small businesspeople, people working for themselves through these platforms, the companies are the platforms, not employers, and i think that's something that will be a receptive message with the trump white house. >> if you got one ask among the men that you think is the most important, which one do you pick? is it the security and encryption? is it net neutrality and the openness of the internet? is it immigration? and please do just pick one. >> look, i think one area is trade. when you look at our companies, 80% of internet users are abroad, but 80% of the value and jobs are created in the united states. a number of our proposals are things that we need new trade deals, which i think we can get and we want to make sure our companies can grow and procespe in the united states but also be exported to the world. >> all right. well, we'll continue to check in over the next four years to see how you're going with those asks. michael beckerman, thanks for joining us. >> thank you. >> president and ceo of the internet association. when we come back, we go live to the l.a. auto show for a

sneak peek at the newest rides hitting showrooms next year. plus, a first on cnbc interview. ♪

automakers from around the world bringing their brightest and best concepts and designs to the l.a. auto show, giving consumers a look at what's hitting showrooms in the coming year. our phil lebeau is live with a special guest. phil, over to you. >> thank you, kayla. we are joined by scott keogh, ceo of audi north america. showing off the new sportback, back here. tell me why this is the right time when it goes on sale next year. >> we launched the a-7 five, six years ago, and what it did was basically double our market share in the segment. so, this combination of a smart sedan packaging with the coup styling works. we call it a sportback.

the equation is simple in the luxury car market -- make a beautiful car and things will sell. we think that's what we've done. >> and right next to the f-5, and we'll showing that right now, we have the q-5. you've got the new q-5, and production is beginning in mexico. >> right. >> and you know the story about what's happening with discussion about vehicles built in mexico imported to the u.s. >> yeah. >> if there's a 35% tax that's slapped on an suv like that or any vehicle, how much would that hurt auto sales for the industry? >> well, here's the first thing. i think what we like about the q-5, that segment is 25% of the luxury car market, so it's a big segment. it's a growing segment, and we have a great car. you know, look, pragmatically speaking, i'm a business person. i need to deal in known knowns, as you know. i can't deep in hype and speculation and things like that. but if you start to talk about a 35% tariff, which is some of the noise that's out there, obviously, that will have a big impact. but frankly, let's deal with knowns, and what knowns are is that's not what we think. >> 35% for the industry, not

just you, but for the industry. are we talking about maybe a 10% hit in auto sales, how much they would fall, because you're asking people to pay that much more? >> i'm not going to speculate on what doesn't exist now. then you're dealing with an if, an if, an if. that's not what the world is. what the automotive world is is an international business of parts and manufacturing and logistics and trade. it's an ecosystem. it's an ecosystem that works well in america. we make a lot of cars here. we make a lot of cars across the globe, and i think the ecosystem works. but i'm not going to speculate on if-ifs. >> you guys are in the midst of potentially settling the emission scandal and what's going on. i know there is a gag order that's been in place by the court. >> yes. >> but the question remains, when you look at the vw brand, when you compare you guys and porsche and volkswagen, clearly, you're not seeing as much blowback as volkswagen the overall brand. do your dealers hear much from customers still about the diesel issue? >> phil, i've always been clear about this thing. any time we disappoint a single

customer, employee or customer, it's disappointing. we are going to work to make this right, without a doubt, no debate. but what we see is we've had 70 consecutive record sales numbers. we're on another record pace this year. and what my focus is, my focus is the business, the employees. and that's what we're going to continue to do. >> last question. >> yep. >> autonomous drive vehicles. i know you're developing it. >> we are. >> are you worried that the trump administration does not share that feeling about let's develop these vehicles? >> i am not, because to me, this thing's not about audi. this thing's not about technology. it's not about legislators. what this thing is about is making america competitive. i believe this sincerely. the future of the automotive business, the future of our infrastructure, the future of american competitiveness is this, and i want america to compete, i want american roads to have the latest technology, i want american consumers to buy that technology. i want american companies to develop that technology. so this to me is a no-brainer. let's go! >> scott keogh, audi north america ceo. you heard his feelings there about developing autonomous

drive vehicles in the trump administration. back to you. >> all right, phil. good stuff today. phil lebeau at the l.a. auto show. still to come on "squawk alley," the head coach of the number one ranked basketball team in the country talks coach 'leadership and his new book. coach calipari will be here at post 9. first, highlights from yesterday's exclusive with ge's jeff immelt. his take on tax reform and finance, next. >> i'm sure my friends like jamie dimon say you guys have earned this, but it doesn't make me go, holy [ bleep ] why did we get out of ge capital? important than your health.

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good morning, once again, everyone. i'm sue herera. here is your "cnbc news update" this hour. president obama delivering a speech in athens, greece, offering reassurances that our future will be okay as long as people retain their faith in democracy and don't waver from democratic principles. >> you may have noticed, the next american president and i could not be more different. [ applause ] we have very different points of view, but american democracy is bigger than any one person. iraqi forces continuing their push into mosul, discovering one of the largest bomb factories run by isis. they found homemade rockets and mortars mass produced by the militants in a mass assembly line production.

de kooning canvas "untitled 25" coming for a record-breaking price of $66 million at christies. the same work sold ten years ago at the then record-breaking price of $27 million. this time around, the painting was sold to an anonymous client who bid by phone. that's the latest this hour. now back downtown to "squawk alley." kayla, back to you. >> thanks so much, sue. markets just closed across the uk and europe, stocks pulling back after modest gains on tuesday. the ftse falling and the pound goes steady in the wake of data showing uk unemployment falling to 11-year lows. bayer is one of the biggest losers in german trading, the company saying it has placed 4 billion euros in convertible notes as bayer looks to advance its acquisition of usc giant mont santos. shares of bayer are down about 4%. european luxury also under pressure. hugo boss taking a hit after saying restructuring efforts, including streamlining of

brands, will only begin to bear fruit in 2018. burr berry, lvmh and christian dior also falling in today's session, but hugo boss down more than 10%. yesterday we sat down with ge's jeff immelt, a week after donald trump became the president-elect. he told us trump is a competitor who wants to win and will have a forward-looking view of the world, including capital investments to boost spending. >> i look at tax reform, carl, and say, basically, what's been sitting out the last decade is capital investment back in the u.s. it's a good chance that tax reform has kind of the missing ingredient that can help drive some of that capital investment back. that's the difference between a 3% gdp growth u.s. and a 2% gdp growth. look, we've had 0% interest rates for a decade now, really. so, if you're a consumer and you have a job, you feel rich, but that's not enough to create the kind of economic growth that i think the president wants to create and most people want to see. so, i think tax reform is

actually quite important with a territorial system repatriation as part of that. >> donald trump's policy is also focused, of course, on deregulating the banks, which has caused bank stocks to rally, putting companies like wells at the top of that list. we asked immelt if he had any regrets moving away from ge capital. >> i don't regret not being in financial services, even though bank stocks have had the great week, you know? i cheer my friends like jamie on, say okay, you guys have earned it, but it doesn't make me go back and go, holy [ bleep ], why did we get out of ge capital? so -- >> it's funny. >> so, again, i think we know what we want, what we're doing. we have a good vision for the company. we like the way the next few years shape up for ge, and our job's to execute. >> a couple of different points here. today we're in an environment where we're hearing the other side of that bill gross today in his note arguing that companies are not civic-minded, they're bottom line-oriented. so, to what degree does deregulation or tax reform result in real jobs?

we don't know. on the bank issue, i thought cramer's point this morning was super interesting. they've leveraged so much to compliance that, in cramer's terms, the layoffs are not coming from the branches if this happens, but all the lawyers they've had to stock up. >> and jeff gunlocke, too, has said this is not going to be a clear trade, that the market's going to be bumpy, because even if banks get deregulation, there could still be a tax on being large because it is so unclear exactly what policy will result from this administration, but i heard no regrets from jeff immelt. >> no, no. >> he was loose! was that northern california loose for him, dropping the "s" bomb? we're happy with our strategy. i mean what was that about? i mean, i know they're presenting themselves as a tech company and they've got this platform that's very important in industrial. do they seem to be making the sale based on the crowd there -- >> yeah, i mean, look, the show yesterday was about machine, learning how it applies to gas turbines and wind farms. but the vendors who were

there -- microsoft, hp enterprise, intel. >> right. >> i mean, that's what ge has become. and as for his mood, jeff's a republican. he used to joke that he was the only republican who watched "morning joe," because ge owned nbc. but i think he's sort of illustrating the confidence that some have regarding trump's policies. >> well, and he was positive about interacting with trump during the time when he ran ge and nbc was running "the apprentice" and said he had a thinly developed concept and trump took it and ran with it and made a 14-year hit out of it. >> right. not easy to do in prime time. >> it's hard to find any ceo who's being pessimistic about trump this week, though. it was easier two weeks ago. >> that is true. and we're going to see if it changes as we get some mean reversion on that. when we come back, head coach of the number one ranked college basketball team in the country will join us at post 9. we'll talk about basketball and leadership with coach john calipari, next. then, he is the third ranking member in the senate,

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coming up today on "the halftime report," will the rising dollar kill the trump rally? that's the big question on wall street. and brad gierschner got into the airlines well before warren buffett did. today we'll talk about united and the new changes they're bringing as well. plus, the new york stock exchange stocks with the highest

assured interest. there are big, surprising names on that list. we'll bring it to you on "the halftime report." kayla, see you in 20 minutes. >> sounds good. see you then. fresh off a win in the garden state, our next guest is author of "success is the only option: the art of coaching extreme talent." joining us now at post 9, legendary men's basketball coach of kentucky, john calipari. >> legendary? >> legendary! >> no. legendary! >> it must be true if we said it, right? talk about your background and how your coaching style evolves and how comparative it is to business, building a team and building a business. >> the book, the reason i wrote, everybody asks, how are you getting all these young, really talented kids to come together and to share? how are you making it so that they're trusting it in the system or the culture enough to give up some of themselves for

the good of everybody, yet they all benefit? we've had 28 players drafted in seven years. 14 kids have graduated, three in three years. they're trying do everything. but my background, my parents -- my grandparents came through ellis island. not educated. my parents are high school educated. i am the first -- my sisters and i -- college educated in our family. i get a chance to sit in a seat to help these families and their children. it's an unbelievable experience. but the book is all about extreme talent. how do you recruit them? how do you coach them? how do you motivate them? but more importantly, make them servant leaders to each other. >> how do you manage the natural tension of you wanting them to stick around for four years -- >> i don't! i don't! you're wrong! i want them to leave when it's time to leave. some of them will leave too early. their choice. >> how do you decide when is too early and when is right for

them? because they're looking to you for advice. >> well, the meeting is about a three or four-minute meeting, because if i try to convince them to stay, i'm about myself. i've told kids, if you want to do what's right for me and my family, you stay. if you want to do what's right for you and your family, you go to that league. our kids that have gone to the league, in most parts were prepared. some were not but chose to go anyway. i can't worry about the program or me at that point. all i've got to do is put them -- here's your information. if you choose to leave, i'm going to help you to try to make it work. but at the end of the day, it's going to be a hard run. >> some are going to judge you not just by how many wins you've got or how many of your players end up going to the nba, but the educational legacy, how educated they get, how seriously they take that. how do you factor that in when the fans certainly aren't necessarily judging you on that? >> well, first of all, we've graduated 14 players in seven

years, 3 in three years. each of our players has a lifetime scholarship. so, if they choose to leave after a year or two, they can always come back. you have a lifetime scholarship. don't pass on your dreams, your aspirations, and say, well, i'm going to stay two more years. okay, now you get hurt. now your stock changes. chase your dream. you can always come back. our kids, not only that, they understand about being in society, the bigger picture. john wall won the community assist award in the nba. big-time award for charity work. you know who was second? anthony davis, our other guy! so, it's more than just basketball. what they'll say is, he didn't care about winning, he didn't care about anything except putting guys in the nba. really? we won more games than any program in seven years, been to more final 4s than any program, won six titles in the s.e.c. and won a national title in 2012. so, you can do it all. let me just say this -- my life

became easier when i made it about these kids. in other words, life becomes easier when you make it about other people. we win more. i'm a legendary coach now. i went from the bum to the legendary coach. and i say this -- our lives become easier when we make it about everybody else. and when you lead with that mind-set, people want to follow because you're going to be about them. that's what this book is about. >> you know, kids get knocked a lot. this generation gets knocked a lot. they're always on their phones, right? they have no work ethic. they don't understand what it means to sacrifice early in your careers. are they easier to coach now than they were 20 years ago? >> here's what it -- i'm a kentuckian. when i walk into a home to recruit, it's not for everybody. we undersell and then we overdeliver. in other words, if you want to shoot 30 balls a game, if you think we're going to play a two-three zone and you're going to do whatever you want, not go to class, don't come here! if you're going to drink, chase,

club, smoke, you can't come here! it will be on the ticker that this happened at kentucky. you come here because you want to be the best version of yourself. numbers don't matter. are you ready? anthony davis took the fourth most shots, karl towns the fifth most shots. booker, the big story in the "the new york times," came off the bench for us. numbers don't matter at kentucky. be the best version of yourself. the pressure to be the only guy is not there. just be the best version of you. >> before we go, i'd love your thoughts on the election, because lexington is in the heart of trump country. but there was so much talk during the campaign about locker room talk and what goes on in the locker room. what conversations do you have to have with your players around that? >> well, more the kaepernick stuff we had to talk through, tell me how you feel. we did some of that. the thing i told our team -- if you feel strongly about a cause, research it and educate yourself so you know exactly what that

cause is. then what is the best way to make a difference? how do you make a difference? are you going to do something to offend and doesn't make a difference? and third, are you ready for the ramifications? are you ready for that? i say muhammad ali, what he did, he went from a boxer to an icon because he stood up, was hated, and he threw -- but he looked at it and he said, he educated himself. he thought this is the best way for me to make a statement and he was ready for the ramifications. he's an icon. that's okay. but make sure you're educated. >> the extremely talented coach john calipari -- >> i don't know about that either! >> legendary. >> i'm going to stay for a while. can i stay? you're throwing bouquet as at me. >> nice having you. congrats on the win. >> when you win, that's what you get on the floor of the exchange. thank you, coach. when we come back, the number three ranking senate republican, senator john thune, is going to join us. he previously called on president-elect trump to withdraw from the race. we'll head to washington and get

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nat democrats electing chuck schumer as the new party leader today. he is bringing in elizabeth warren and bernie sanders to join his leadership team. a sign of how democrats may try to challenge the new trump gop reality. take a listen. >> when we can agree on issues, we'll work with him. we're not going to be like some have done here in the past.

just because it's president trump eights idea or thought, we're going to oppose it per se. where we can work together, we will, but i've also said to the president-elect on issues where we disagree, you can expect a strong and tough fight. >> let's get it our own john harwood who is with the chair of the senate republican congress. john thune. hey, john. >> the interesting thing about this president is that he is going to have disagreements with his own party as well as the other part. we' party. we're going to talk about that with john thune. >> congratulations on being re-elected, and congrats for surviving that squeaker in south dakota. i see you have just barely 72% of the vote. >> well, you know, sometimes better be lucky than good, right? >> exactly. you called on donald trump to withdraw from the race and let mike pence be the republican nominee. are you glad he didn't? >> well, that's behind us. it was a painful and difficult campaign for a lot of us.

he is now our president-elect, and i'm looking forward to working with him. campaigns are hard, and sometimes it's -- it can be a difficult and tumultuous process. now that it's over, we're excited to see what we can get done together. >> what what's your observation of the transition so far? you might have seen that mike rogers was ousted from the transition. he said last night that there's some confusion about the chain of command and there have been people tied to chris christie. does that trouble you? >> i think that any transition -- i know you have covered them in the past -- are -- you know, they're complicated. you got a lot of people who are trying to do a lot in a very short period of time. positions to fill. it really is like drinking water from a firehose.

this is no exception to that. i think -- >> does this feel like a -- >> i think transitions tend to be kind of messy. you look throughout history, and i think that's the nature of the beast. they'll get through it. they've made some, you know, good appointments. there have been some stories about people who have left. i expect we'll hear a lot of names in the future. >> tell me what you think republicans in congress, the house and senate, can do with president trump next january fast. >> well, i this i that there are a number of things obviously he can do just by sort of executive order. he can reverse a lot of the executive actions of the current administration, which i think will be a welcome relief to a lot of people around the country. the regulatory area for sure. we're going to be hopping on very quickly repealing obama care. that's does we've committed to

do, and he has committed to do. >> do you think that popular portions of obama care should be retained, and if so, since those are tied to the unpopular parts, how do you do that? >> well, i think there are features that will be retained. the preexisting condition, the ban on denying people coverage for preexisting conditions is something we all agree on. i do think that we have a template for this because we did it a couple of years ago. we sent president obama a repeal bill, and we used the budget reconciliation process nod to do that, which allows us to do it at a 51 vote threshold, and we figured out what was doable under that type of a scenario. we were able to repeal the individual mandate, the employer mandate. a lot of the taxes. there may be some things we can't do, but we'll cross that. >> building a border wall and deporting the 7 million people who are here without

documentation. >> deportation, no. there's not support for that across the board like that in the way that you are suggesting in congress. i do think that reasonable doubt boer security will be a high priority, and i think the wall will be a component of that. whether that wall is a physical wall or a virtual or technological wall remains to be seen. i do think it's an element of -- >> the former house speaker told our colleague yesterday that there was actually a chance for comprehensive immigration reform in this congress with this president. is there? >> well, i think that it's -- we know the system is broken. we know there needs to be reform. the particulars of it have not been worked out. i think it's possible. >> let me ask you about taxes.

he has proposed a big tax cut in the individual can code. he has proposed big cuts in the corporate code. he has also proposed very large infrastructure program which some people in the congress think can be paid for with international tax reform. do you envision congress doing all of that or a focus in the beginning on infrastructure, business tax reform and the individual tax reform goes later? >> i have always felt -- this is my personal preference. we haven't had this conversation yet with the new team at the white house nor with the colleagues in the house. the house of representatives has a bill that reforms a corporate taxes, business taxes as well as individual, and i think it's hard to do them separately because you have so many past businesses that pay at the individual rate. >> that slows everything down,

though, right? >> it slows it down for sure. i think if you are thinking about doing something big and you are going to have an infrastructure piece to this, which i think, you know, in order to attract some democrats, that may be a way of getting there. it's going to take some time to work through it. weave done a lot of work at the senate finance committee. >> it's realistic to think that within the first 100 days we're going to have a tax cut, individual, corporate tax cut and infrastructure plan pass the congress? >> i would hate to make any predictions about the first 100 days because of the complexity of what we're talking about, where. >> not likely. >> i think that something that takes a little bit more time to work through. i think it's very possible. i think it's necessary. we have to do something about the tax code. it's antiquated. it is something i think that is really harming investments. >> one other thing about obama

care. if if you repeal obama care, says 20 million people who now have health insurance will lose it. how are you going to manage that? >> first off, the bill that we passioned two years ago had a transitional period in there. a couple of years for us to sort of phase these things in. obviously, you can't overnight make a lot of these changes. if that's the case, we have a lot of ideas about what to replace it with, what a new health care program will look like that would cover those 20 million americans. >> thanks so much. guys, back to you. >> fascinating exploration of all the issues and just how quickly you can wrangle some of the complexities, whether it's the first 100 days or not remains to be seen. >> he said comprehensive tax reform. not only very possible, but very necessary. >> a little bit of a window,

too, though, on how every republican is not going to exactly fall in line behind a president trump. thune was hedging on quite a few things. >> meanwhile, do you have something coming up at 2:00? >> as a matter of fact, i do, carl. fort knox. it's a new digital show that i am launching that our team is launching today. go to facebook. jon fortt there. also expect to see it on cnbc's facebook page as well. alexis o'hanian sat down, and we're going to go through what he had to say. a couple of our colleagues are going to join me live as well in just two hours from now. >> is it going to be exclusively facebook live or do you see like a taped component down the road? >> there's a podcast also that you can get on sound cloud now. you can sign up on itunes. that's an audio component. yes, the idea is to be multi-platform, do something on periscope too. it's going to be all over the place. >> and what topics? what do you plan to cover? >> it's not about gold, right? >> we might throw gold in there. it is fort knox.

not just technology. it will be broadly -- these are people who are changing the world, and it's a diverse world. it's a global society where innovation is just absolutely the name of the game. we're going to be talking about how they are handling that. >> fort knox, binge. >> dvd. >> it's a good topic. >> the world is our oyster. >> it's good stuff, jon. see you this afternoon. let's get back to headquarters. wapner and the half. >> welcome to "the halftime report." i'm scott wapner. top trades this hour. the state of the trump rally and why the rising u.s. dollar could doom stocks. joe terra nova, josh broen, najarian brothers as well. we do begin with stocks pulling back after their post-election run. you might just blake the surging greenback, and that continues to rise. the dollar index now at its highest level in 2003.