to have to struggle the strong dollar with that desire. >> folks at carrier, we don't have many three-hour guest hosts anymore. >> i appreciate the invite, really. >> thanks for hanging out. >> melissa lee, thank you for hanging out. >> we'll see you -- >> yes, wednesday, big day. >> wednesday adp and friday jobs. join us tomorrow, "squawk on the street" begins right now. ♪ good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber at the financial market. italian referendum and keep an eye on retail and cyber monday. europe's in the red. 10-year 2.32 is lower than the 2.4 we fwot on friday. road map begins with record highs in stocks. trump rally enters its fourth week as we see a new upped

forecast for global growth. >> the business ramifications of a post fidel castro world, will the president-elect reverse the thawing of relations? >> plus, the american consumer's back, at least according to estimates from the shopping weekend. but did retailers benefit? >> and at&t goes over the top, another online service aimed at cord cutters. we're going to have those details in a moment. first up, a new trading week after the three major indices closed friday trading at record highs. same goes for the russell which is coming off its 15th straight day of gains since february '96. small caps up 12.7 since the election. the russell, guys, only had two streaks longer than this one in its history. >> this is remarkable rally because it's based on everything that this guy says. like anything that trump said is going to come true. and i think that's because people just feel like the republican party's going to fall in line. you know, i have to tell you that the agencies control a lot

of what happens to small caps. a lot of people have felt that the large companies have had the run of the place. they write legislation, it tends to hurt the smaller cap companies, smaller cap companies don't have to worry about a strong dollar, the dollar's been incredibly strong. i'd buy it. i think the small cap companies have been overlooked for years. i think people don't care about them. and suddenly they care about them. and i think this russell streak is a right one. they've been left behind. orphaned. >> they have been, until recently in this very almost record setting pace of gains. >> yep. look. i don't know about you guys, but i got to talk to a lot of people this weekend. and everybody said two things. one is, this trump rally can't last. and second, when i ask why not, they say, i don't know. it can't last. you know, i wish someone had said, well, let me tell you it's because of the rekoint, or because he doesn't have the votes in the senate. no one seemed to know other than the fact it can't last.

and you need something which says it can't last because of x. i didn't get x. >> well, you're not going to get x until the presidency really begins. >> that's for ages. >> right. that's not for another month -- more than a month and a half. january 20th. >> in dog years that's like 72 days. >> okay. so maybe you're clear until then. although you never know. with a tweet here and there he can certainly impact things as he did yesterday. >> i think he tweets the russell should go up for another five days. what would happen if he tweeted that united technologies made a deal with united technologies to keep that carrier plant here? >> we've already had varying interpretations of whether ford's decisions are because of a discussion he had with them or not. we don't know. >> even though lincoln was not about to move navigator. >> carrier -- >> if the carrier plan stays there's going to be another -- like maybe that's a deal. repatriation deal. maybe it's a kind of like -- >> well, it's a tough

negotiation. i did reporting on this obviously it's a tough negotiation because much of why they would stay are things that aren't necessarily fully in the add -- incoming administration -- >> you mean like 10% business -- >> well, that, but no, what you're going to get in return. the tax reform and/or the factory subsidization that would come as a result of some sort of plan. i mean, that's congressional work yet to come. >> but the vice president is from -- >> no, he's dealing with this. this is his negotiation, as we reported on friday. >> this plant was closing. they were going to monterey. >> and they may not. >> and they may not. >> and this is fulfilling a campaign promise which is then going to make people feel he'll fulfill the promise on the banks -- >> you are all in, man. >> i am not all in. >> this jefferies cutting citi, wells -- >> ill advised. oh, because they're up 12%?

citi isn't even back to where it was last year in the summer. it's not even better. what is that all about? time to go? why is it time to go? because it's up 14%? it's like nowhere near where it was in like 2006. hello. i mean, do you really think if they roll back regulations that these companies can't make a fortune? >> no, they would be beneficiaries of that. and beneficiaries of tax reform. of lower taxes for corporations. >> yes. a lot of activity. >> and maybe even m&a activity. >> those are policy measures that will be months away. >> if not years. >> to me the wrap about why the rally can't last is that stuff's too far away. >> sure. you don't dispute that. >> no. that is far away. but i feel like the downgrade of the banks ahead of a rate hike where i can raise numbers?

i mean, i'm looking at the sensitivity of some of these banks to rate hikes. and people's united bank of connecticut, i mean, they make a fortune -- i mean, the rate hikes are so positive that to get ahead of these bank stocks and downgrade them, mistake. just a mistake. you'll never get back in them -- >> i think to your point it's interesting, i think a lot of people are looking for some help here in terms of direction. >> yes. >> because we've had an unexpected rally of significance. >> yes. >> and we're now heading in deeper into the transition. and then we will get obviously a new administration. and what can we really expect? and what do i do? is this all follow-through? is it all simply one long positive continuing for stocks? there's got to be something there that starts to say, wait a second, either things are getting a little too rich in terms of multiple, or expecting too much in terms of all the tax reform, the rollback of regulations.

>> right. >> and/or there's going to be volatility in other parts of the administration. >> oh, look, can we add -- >> and trade and so many things like that. >> just a few moments ago trump tweets, if cuba's unwilling to make a better deal for the cuban people, the cuban american people and the u.s. as a whole, i will terminate deal. doesn't give any bar over which a deal has to cross, right? that's what we're talking about about volatility. >> i guess i got to merge somehow got to have the s&p futures, the treasuries, trump tweet. i mean, we're going to have to redo our screens. >> we are. it's a weird world where apparently the president is going to be tweeting at all hours and conceivably saying things that will have market moving potential. the stuff where he said on no basis of fact whatsoever that there were millions of votes cast illegally is not a market moving piece of information. >> no, but he's disintermediated the media. you don't need the media to read the tweets.

the special youtube presentation. i mean, the guy -- google and twitter are going to do well here. google and twitter. i mean, maybe you can sponsor presidential tweets, right? i mean, like he's still got the businesses going. >> be giving 15 million viewers a pretty good night on broadcast television. >> anthony nodo right now is thinking, okay, i got to find someone to sponsor the political tweets. >> i'd like a little more than 140 characters. i just would. i'd like a press conference maybe. call me old fashioned. >> well, you can toss out all the guys you don't like and have a press conference. remember once dan rather stood up to president nixon, this is going to be a little different. are you running for president? >> no, sir. are you? >> yeah. now it would be like rather said something stupid in the press conference and i'm not inviting him anymore, right? that's it for rather. but he would type it while during the press conference. i mean, a guy -- you got to

admit the guy is a new dynamic. >> yes. >> yeah. >> if he saves that carrier plant, you think we're not going to see a thousand tweets from different people? thank you and then says thank you and then they do the thank you and he retweets and a lot of hearts. >> got a lot on his plate, not just carrier, but now cuba, the world and business community keeping an eye on cuba following the death of long-time dictator fidel castro. our chief international correspondent michelle caruso-cabrera is live in havana this morning with more. good morning, michelle. >> reporter: good morning, carl. there were lots of hopes and expectations in the wake of the thawing between the u.s. and cuba, which began in december of 2014 that there would be a lot of u.s. investment, a lot of corporate engagement here, so many executives traveling here to see what could be done. well, where do all those hoped for deals stand? deals is a strong word. let's show you what's happened. there's roughly 30 companies involved here, and i use the word involve very specifically because deals isn't quite the

right word. most of those or roughly half are in the hospitality area. american airlines, united, alaska, delta, southwest, jetblue, silver airlines and sun country are now doing commercial flights. used to be just charter flights. in fact, direct flights to havana start this week. starwood is managing three government-owned hotels. we don't know the finances of that deal. are they paying the government, or is the government paying them? carnival has been here with some cruises. and now american's use with american credit card on airbnb and speaking of credit cards despite the much he recallralde announcement, mastercard made that happen however mastercard does not issue credit cards. banks do. if you want a credit card that works here you must have a credit card from either stone gate bank in florida, stonegate bank or banco popular. not allowing customers to use

here. there are roaming agreements. if you have u.s. carrier, verizon, at&t, sprint, t-mobile, it will ring here. i have to tell you that is quite a relief. and you can make direct phone calls now because of a company called idt. fed ex is flying a turbo prop and nespresso from the united states is putting out pods with coffee made here. here is what you should note about every one of those deals, they're not deals like we think of them. there are no investments here in cuba. these are deals that provide the cuban government with revenue, but the traditional way we think about putting in equity stake has not been allowed thus far because, remember, this is a socialist and communist government that very much wants to control everything and controls every major business in this country to the extent that there is still business left here after 50 or 60 years of communism. look over my shoulder. big line of hundreds, probably thousands of cubans have lined up. what are they here for?

to go see the ashes of fidel castro at the monument here at the plaza of the revolution where tomorrow night there's going to be a memorial service for fidel castro. for years people have been asking what is going to happen after fidel castro. no one knows the answer to that, but at least now we're going to find out. >> michelle caruso-cabrera in havana summing up exactly what's in front of us and in front of the president-elect. really quickly, jim, would you be doing a u-turn on some of these trades that had been brought about because of this normalization? >> no, i think this is going to be in cuba's court. i think that maybe out of honor to fidel they were not willing to make the steps we gave a lot. i think we gave a lot. i think if they do something i think it changes the equation. we did. we made peace with castro while castro didn't make peace with us. >> so you're in favor of doing exactly what trump suggests? >> until they come out and say

something. they're going to give up the fascist dictatorship. did anyone watch, i know it's another network "60 minutes"? >> yes. >> i was waiting for america's game, which was quite good, colorado, broncos. >> missed that one. >> they had an interview with fidel castro when castro came in. wearing a suit, fidel castro was wearing pajamas. >> pajamas, it was great. >> the dismissal that he had of our nation, i mean, that has to go. and if raul castro just says, you know what, everything's kind of forgiven, then i think everything will get forgiven except for some hardliners who did vote for trump in florida. but it's their move. not our move. we did everything. i think obama was incredibly open minded. what did they give us? so i think there's a deal. i think that by the way there's a lot of dealing -- i think trump wants to do the art of the deal. i mean, he's dealing in indiana.

>> sure. >> he likes to deal. >> that's what he knows how to do. >> well, maybe we haven't had a president who likes to deal in a long time. >> everything's a negotiating position. >> right. right. including, you know, who gets to be in a press conference. i mean, everything's up for negotiation. >> yeah, okay. great. you know, you're kind of a journalist, you know that, right? >> i'm not trying to get to the table. >> okay. >> i'm not -- i'm reporting. i'm reporting on united technologies -- >> say again? what about it? you did some reporting on that too. >> yeah. >> good for you. >> when we come back, the holiday shopping report card and where tech fits in. take another look at the premarket here this morning. for the month russell's up 13. dow up 5. s&p up 4. back in a minute. ♪

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holiday shopping numbers are in. the national retail federation says about 154 million shoppers made purchases at stores or online over the weekend. that's 3 million more than a year ago, but there was a slight decline in average spending. meanwhile, adobe says black friday was the first billion dollar mobile shopping day in u.s. history. we're going to discuss the

holiday shopping landscape with nrf ceo matthew shay in the next hour. >> this was the first time my travel trust owns adobe, i've met the guys who run adobe, and they actually have the big data. they have the transactions. this is the first time. it's not a poll. it's not a guy guessing. it's not, well, i have a sample. those are the numbers. the numbers are good. let's not outthink this. and by the way, you can follow the way things went through colombia sportswear, vf corp. or weather, colder weather. if you take a look on the conference calls for ross stores and tjx, the main issue was is there enough excess inventory? now, they said that there is because macy's is closing some stores. but overall we have to remember that a lot of this big ticket stuff is going. and that's where the stuff that is historically -- >> but the malls themselves, the physical locations may not have been as crowded.

>> no. but i think that's just -- >> does it really matter? we had brian cornell here on friday talking to him and target is agnostic. they don't care where you're buying it from or how you're buying it as long as you're buying it. >> it's working for a lot of these companies. they've spent a lot of money and it is working. still 90% of people shop in stores, but i think best buy had a good christmas, i think target had a good one. i know from my friend who writes for the street jc penney had an excellent one. i can't believe how many people lined up at a jc penney in order to buy the shirts that they have their own private label. >> yeah, we're going to get pvh earnings this week. this is all depending on whether or not store rationalization is taking place. >> well, if we had that -- look, we need to see -- i defer to my better half colleague who does all the reporting here and much more neutral in politics, please, where are the retail mergers? >> it's going to be an interesting four years for you,

isn't it? but i will come visit you when you're in jail. maybe you'll come visit me. >> community protect journalists -- >> yeah. >> where are the retail mergers? >> how about turkey? >> that guy gets away with anything. >> most jailed journalists in the world in turkey. >> yeah. david, where are the retail mergers? that's where what we need to see. take capacity out. there's an article today about gap and how gap does like algo -- >> those are tough to pull off in a lot of ways. >> why is that? >> remember hudson bay did a great deal with saks, but that was real estate related. the reason they made money was real estate. but, you know, why would you want -- if you're succeeding and you're really going to want to buy something else, there's so much capacity, you don't need it, what's the value of it? >> let me give you an analogy of it. he bought first niagra and shut 100 branches because they're too

close, there's too many stores. >> there are. >> way too many stores. would sears ever -- all right. that's a bridge too far, sears. did you do any shopping at k-mart this weekend? >> i did not. did you? >> i'm willing to shop anywhere. i won't go there. >> really? >> make it a principle. >> yeah, i think people understand that. >> and i've shopped at dollar tree and dollar general, l brands, not a problem. ross, perfect. burlington. i will not go to k-mart. i won't. statement. >> yep. we are going to get dollar general earnings this week as well. a lot still to come in the coming days. we'll get cramer's mad dash in a moment. take another look at the premarket on this monday. more "squawk on the street" from the nyse straight ahead.

♪ mondays come around too fast for me, my friend. but here we are, a mad dash. let's do it. >> david, i have not been a fan of the so-called brick and mortar journalism houses. in other words, places that are trying furiously to convert, unlike retailers, to online where they end up making much less on advertising. i see a bid this weekend or rumored bid of -- for time inc. backed up by some big money, true or false? >> it is true. >> it is true? >> yeah. the "new york post" reported this got it right. my sources indicate as well roughly a rain of $18 a share. went in with a letter about a

month ago at time, that is investor group -- what's this guy's name? and la vot nick. but they weren't coming public with it. not sure where the lead came from. let's call around $18. they got rejected. not interested. no further discussions. we do have some activists in the stocks. [ inaudible ] my mike has not been working. let's take a break. we'll come back. >> you know what, david, this is fabulous reporting. let's take a break. >> we haven't heard any of it. >> we got the opening bell. we'll fill you in on time as well.

you're watching cnbc live from the financial capital of the world. we're going to get revised q-3

gdp. jobs number on friday looking for about 165, 175,000 jobs. opec meeting, the tantalizing louis si-charlie brown football game continues. >> great way to put it. if you freeze at these levels, you're freezing at the maximum. shale is really coming back. i've done a lot of work on shale this weekend. you'd be surprised how much the permian's going to be pumping year over year. you keep getting bigger rig count numbers from baker hughes. those came out wednesday. so they need a deal in order to go back to 41, 42. in the interim this is the first time -- look, you need to see a gigantic number of employment. because the market's set up for a rate hike. doesn't want to see things are bad. now, yesterday, i see rates go down a little, that's going to rotate money back to kimberly and clorox. we wanted to stay with j.p. morgan. >> although suggests number could be good. >> i think it could be good. i think we ought to nail the number here.

we ought to go nail the number. >> do you miss that game? >> i liked that game. >> yeah. >> that was a game where there were winners and not a lot of commercials and a game didn't go on too long like four and a half hours. >> tlrs the opening bell and s&p at the bottom of the screen. at the big board today it's invesco celebrating the launch of a new fund. over at the nasdaq online jewelry retailer blue nile celebrating cyber monday. a lot of attention on amazon today. 2% of their total sales are done, if not today then this weekend, this past weekend. >> boy, they had some good ads this weekend. i do think the note -- there's a little confusing note that i asked david for help here. mark may at citi, amazon web services price reductions he said could hurt. now, i mean, if they do price reductions, does that necessarily mean that perhaps volume goes up? >> it does. although i think competition and you know this better than i do

and, jim, has increased. they have been met in the marketplace where for some time they were sort of alone. and now there are a number of cloud offerings that i think are significant for the enterprise. and so you may have some price erosion. not that they haven't brought prices down because that's been their strategy all along. >> right. >> it's not like they've been raising price. they've always been lowering. >> one of the things i think when you see what semiconductor companies are doing well, it's part of data center and the other data center's catching up to amazon. it's very important. that has been the strongest part of tech is data center purchasing. which is why wen intel reports if they don't have a good data center purchasing number, they say that's the growth area. everybody wants to keep with amazon. has to. a lot of the so-called fang stocks they have one day and then they come back. but they're in the running. they're in the running for being best stocks again.

they really are. >> you mentioned oil, west texas now is on the brink of cracking through the 50-day at 47.50 just about. so there's some optimism this thing holds together through the week. >> if that happens, you're going to see chevron has been a fantastic stock through this. there's a piece this morning about wpx that i read. wpx is a company that has a lot of permian. you know, ox si's got a lot of permian but they paid way too much. apache's got a lot and paid perfect. permian is so good at $40 they make a ton of money. by the way, natural gas, article today about how we're exporter, wefr been exporting for awhile now, the natural gas pricing, if we get sold cold weather that's going to hurt the rails because everyone's been saying natural

gas. natural gas go up too much then it will help the rails. the rails need it because the rails have been the hottest stocks. they need coal to come back. have you noticed? because trump -- is that jim cramer saying make coal great again? >> no, you've given a balanced view of coal. >> i'm against coal. >> you are. >> well, the world is against coal. >> yeah. >> coal causes global warming. >> climate change, yes. global warming. >> you're right about the transports. up 12%. >> they've been so fabulous. they've been leaders. that's another reason why i like the market. now, could -- is it due for a pullback? we've been up, up, up. we're now overbought 5%. the investors intelligence poll shows the most pulse in a long time. there's a lot of momentum and we add a lot of wild stocks to go up, small cap stocks, but let's see. if the transports stay strong, you've got a lot of things

going. toipt look at a piece of research came out this morning by a very good analyst, best ideas for 2017, most likely to benefit from trump win general dynamics. i see one of these pieces three or four times a day. something benefit from trump win. >> yeah. >> and that's what i'm talking about. that is the kind of thing i'm talking about. >> let me give you the opposite, a name we haven't really talked about that much. i don't know if we can do a three-month or even a one-month bud, b-u-d. have you noticed what's happened to anheuser-busch in the last month? >> is that currency? >> that is currency. largely currency, also worries about ability to make acquisitions in the u.s. that stock is down from 130 to 104. >> it's been worse than constellation chrks is worried about modelo being imported. bud has been a horrible stock. good you mentioned that because it was an up stock for a very long time. they need more deals.

>> of course the deal didn't close that long ago the deal itself. >> and yet tap turned out to be a winner again, david. constellation i think is going to be overdone. i do not think there's going to be a tax on beer coming from mexico. but, you know, the worries remain because this mexican situation has been kind of still in play. >> couple of media stories. disney had a good weekend with "moana," $81 million, one of the top two thanksgiving openings ever. mike florio at nbc sports reporting to according to a source the nfl is examining trimming or eliminating thursday night. >> what? >> yep. >> oh, my god. >> possibility of ending or at least limiting thursday night football. >> tired night football. i have had some sources who have said that tired night football is not -- i'm sorry, it's called thursday night football. that the players hate it. >> you've been saying it for a long time.

>> the owners hate it. the league debated the quality of the football games two years ago and decided, you know what, i don't want to put words in their mouth, but they felt that the quality would improve. but the players, everybody knows that on thursday that's the first day they're feeling like they could be okay and the players hate thursday night games. so that would be remarkable because, boy, a lot of money came in from thursday night. that's why they took those contracts. because they knew, i mean, if you ask the people at high level the nfl, they knew that those games did not have good quality. >> right. right. >> now, i don't know if you watch them, but -- >> they still ready to give up that revenue? >> well, that's why -- >> that's hard. >> that would shock them. >> at least another year or two, right? >> i think nbc -- we work for nbc, but they've introduced a lot of programming and their number one is sunday night football, which is such a hit. and thursday night football has been a fantastic way to introduce things. but i think that the quality of play has really been called into

question. and they also have to drop some commercials. they have to drop the commercial after you do the kickoff after a touchdown, and then they go right to a commercial. they got to drop that commercial and considering that too. because there's just the games are too long. the games never end. i mean, i'll be at the green bay-eagles game and i am going to do this from that game, right? >> i'm with you. i do it 45 minutes in. you dvr and then you're able to more or less catch up. >> watch constant football. >> yeah, watch constant football. >> see, versus michigan state, ohio -- versus michigan-ohio state, overtime game, fantastic, wife doesn't get angry. >> real quick because we did have a mike problem during the mad dash. time inc. is up about 12%. we were going to talk about it "new york post" story i can confirm investor group led by

edgar bronfman. about a month ago they sent a letter to the board they were rejected told we're not interested in selling. nothing more than that at this point. unclear whether they're going to follow through, but now that it's out there that can always change the dynamic. you do have jana in those shares, an activist. we'll see. bears watching. brethren in name, time warner, this is not a controlled company unlike "new york times" or unlike news corp. which are obviously in the same business in a way of trying to make their businesses digital but moving from print. >> david, this has been a disaster. >> joe ripp left as ceo not that long ago. >> i thought he was a good exec. why do they want this, david? is this just vanity? do they want to own -- >> the swim suit issue? >> that's a good issue. >> yeah. that's their big moneymaker. >> do you know my friends at espn have said it was the spend on technology from espn that

really put sports illustrated in its grave. now, i happen to love sports illustrated, i love the writing, but i'm saying it is really incredible how much money tigig spent on tech and had john walsh there doing editorial and build up a company -- "sports illustrated," who got "sports illustrated" when they were growing up, right? >> oh, yeah. loved that. >> espn, i don't know, i just find this to be vanity. they have a lot of money. and they want to own it, like amazon. when he bought "the washington post," how much does he -- >> might have some ideas. >> maybe he wants to write editorials. >> this who sold maker to disney seems to know his way around pretty well. >> how long did it take for them to write that off? >> i don't know. >> i shouldn't say that, but they paid a lot. >> they did. >> dow's down 45. let's get to bob pisani, see what's moving on the floor. hey, bob. >> hello, carl.

good to be back everybody, after a week off. we are taking a bit of a pause and about time after the big gains. i think a lot of people were quite surprised by the gains we had last week. some would expect consolidation but a lot of momentum in the market right now. take a look at sectors. we've had big gains in banks, in consumer discretionary, industrials and materials. not surprisingly those tend to be the ones that are slightly weak today at the open, that makes a lot of sense here. we talk a lot about the s&p 500 versus the russell 2000, the huge outperformance. a 10 percentage point outperformance in the russell 2000 versus the s&p 500 since the election began. there you see what's been going on here, that's the white line the russell 2000. so 13% since the election in the russell, s&p 500 up close to 4%, almost a 10-point differential that started the day after the election and has continued. you can take a look at small caps. we don't often mention a lot of these small cap names, but you look what happens here with these materials and industrials and bank stocks.

we tend to use big cap names here. but the small cap had done even better. so your a.k. steels and century aluminum up huge, trex, outdoor decking company, many of the small community banks like first nbc, small new orleans bank, never mention them because they're basically very, very tiny. they've had huge increases just in the last couple of weeks here. so when is this going to stop? a lot of people are being forced into the market. cash does not go up in a rising market, so people are coming in. the good news is this tends to continue when you hit new highs like we've had. 11 times this year put up the charts 11 times we've hit historic highs this year, two of them last week. so if you take out the two last week, nine times this year historic highs. the market's been up the week after good percentage of the time and nice moves up in the nasdaq 100 and the russell 2000. so the lesson here for this year is the momentum tends to continue when you hit historic highs into the week we're talking about right now. the problem is the sentiment is getting too bullish. we've said before the best

friend the market has had has been the negative acceptabilitiment in the last several years. it is now changing. so the aaii investor survey 50% bullish. we normally a month ago we were 23% bullish. this is the highest level in nearly two years overall. and if you look at the merrill lynch global funds survey, they did this the week after the election, 35% expecting economy improving next year. that's the highest in 12 months. and the cash levels have moved up for the global fund managers to the largest levels since august of 2009. and the bottom line here, david, is when you get sentiment levels this high, they tend to be contrarian indicators. a little bit of a warning sign here for the markets. david, back to you. >> thank you, bob. bob pisani. haven't talked too much about activism in this market lately. but worth doipg so this morning. certainly at elliott management they've been quite busy when it comes to activism. remember a few weeks ago they went after samsung and follow that had with a report on marathon. and this morning they're back in

technology where they've always been quite active. and after cognizant. >> wow. >> they own 4% of cognizant technology solutions, about $1.4 billion position. so dollar wise a large position for elliott. and they release a letter 16-page letter/report. it's a dear john, frank and members of the board letter. and the focus for elliott is on the company's continued maintenance of the operating margin that is the same, roughly 19% to 20%, when they say margins can be a good deal higher and they don't need to be investing as much in the businesses they have been. and they also by the way should be returning capital in some fashion to shareholders even through a dividend or other means of capital return. let me give you a couple of excerpts from the letter itself. this has been an issue it seems for some time.

when you look at some of the calls they've had with the street, analysts bring it up time and again, here's the first part. cognizant's target margins are 1,000 basis points lower than those of direct peers while all cognizant peers focus on achieving higher levels listeninger tomorrow cognizant remains for 20 years, point being you're not a small company anymore. you're 200 times as large as you were when you were doing that and reinvesting in the business. you're still growing at 10% a year, but you could be growing at a faster rate in terms of the bottom line were you to take that number up in terms of margin. they say while the discipline of reinvestment may have made sense when the company was emerging the established dogma of managing to a number evolve iin business conditions no longer makes sense. relative to both peers and optimal business practices, cognizant's lack of an appropriate capital return policy has long made it a

distant outlier with $13.5 billion in cash, $2 billion in cash flow, $4 billion of net cash, meaningful margin ahead, doesn't have a dividend, only repurchase to shares and clings to flawed belief somehow at odds, jim. their point being when you -- t5 times, the reason it's not getting what it deserves in the marketplace, being cognizant doesn't get it, is because of these things. there's an opportunity to talk to the company, nominations from the board of directors don't hit until march. kind of a nice window there. >> i'll tell you, you bring them in when you want to digitize or find out digital strategy. i thought that's what you used to do at cognizant. they have been left behind, but that's because the other

companies are so fabulous. >> although elliott has no problem with the company in terms of how it operates in its sector. basically unhappy with the fact it seems so focused on maintaining same operating margin for 20 years. >> it's really interesting because they want to do a little bit m&a, big cash position underappreciated, but it's not -- it doesn't grow like the other guys. >> right. >> i think they're onto something. i mean, it used to be one of the great growth stocks of all time. i was surprised teaneck, new jersey, and it had this reputation of being the fastest grower in the advisory business in the consulting business. and then they were blown away by essensur and they became something you don't hear about a lot. >> all right. we've got to get to rick santelli at the cme group in chicago. >> did reporting. >> a little bit. rick, take it away. >> good morning, david. if you look at 10-year note yields we're at 2.41 intraday on

friday. traded 2.41 from our time zone. so from intraday basis a 10 basis point drop. but here we sit down a couple on the day, mostly a clear flattening trade with 2-year yields down much less. option volatility as you hear behind me is growing rather large. july 1st of 10-year that's the last time we were closing up here, just to give you an idea. so friday was the high close. bunds, completely different story. from february of '16 we reached a high yield mid-month in november, which was 32. we're now trading under 20. a year-to-date of 10s minus bunds a whopping 213. hasn't been that wide since the late '80s. our yields are firm against softness from italian banks, prevote in december, the referendum and finally year-to-date of the dollar index trading at best level since 2003

virtually unchanged and unfazed by the other market activity. carl, back to you. >> rick, thank you very much. rick santelli. when we come back, a closer look at the phenomenon surrounding "the walking dead." meanwhile, s&p down about six led lower by some retailers, urban, michael kors, amazon and others. we're back in a moment. today, i am helping people work better... and also feel better. i am helping hospitals personalize treatments using billions of data points. and working with medtronic to predict the highs and lows of diabetes, hours in advance. and i am working with orreco to use biomarker data to boost the performance of athletes. hello, my name is watson. working together, we can outthink anything. if you're on medicare, remember, hello, my name is watson. the open enrollment period is here.

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amc's "walking dead" has shattered records. we sat down with the producer of the show who also produced "terminator" and "alien." this is her story on what has become a tv juggernaut. >> it is a phenomenon. it's not something we ever expected. if anyone says they did, that's not true. i was there. but i think with "the walking dead," the thing is that amc was looking to fill a particular niche. and it's not one that most of us were aware of at the time, which is that their most successful block of programming was not

necessarily "mad men" or then "breaking bad," it was fight fest where they aired for the two weeks leading up to halloween classic horror films. so they thought, if we're going to launch something, it should be in the horror genera. and we launched "the walking dead" on halloween. >> i love stories where the motivation for going in a certain creative direction was not necessarily to make a lot of money, although that's exactly what happened. >> so different from anything that's algorithmic and machine learning. and a lot of people -- i've always liked it. find it very frightening. have to watch with a pillow. >> and her ability to stretch out the season doing shows in the offseason where a show just talks about the narrative. >> yes. >> fascinating story. >> i got to watch that because i just found -- my family watches that show. they have it. teenagers watch it with their parents. it's really amazing. >> numbers are incredible.

that episode of binge is coming this week of course on apple tv, youtube and hulu and at cnbc.com/binge. we'll get stop trading with jim in a moment. dow's down almost 60 points. be right back. bees? eese. trees? eese. xerox helps hospitals use electronic health records so doctors provide more personalized care. cheese? cheese! xerox healthcare services... ...soon to be conduent. that's it. how was your commute? good. yours? good. xerox real time analytics make transit systems run more smoothly... and morning chitchat... less interesting. xerox transportation services... ...soon to be conduent.

time for cramer and stop trading. >> you know, the fallout from eli lilly's true gaffe i'll call it from the alzheimer's today continues. i think a lot of people felt eli lilly was far too bullish about a study about a disease as we saw from "60 minutes" as well. watched it last night. a disease that seems very intractable. there was a lot of false hope here. and tried i felt picked a day where they were thinking there would be not a lot of people focused on it, but this was a major disaster for eli lilly and there's no minimizing. this is incredibly important, if not as important as opt vo with bristol-myers, i think they have to re-examine the way they handle themselves because they really gave a lot of false hope

frankly. not the lilly style of old, let's put it like that. >> in the midst of a transition too. what's on mad tonight? >> we've got paypal really in the midst of cyber monday. this is great because this is cyber monday, they've got a great charity event tomorrow. and bob dutkowsky, he has been one of the great winners and just bought a company. if you look into ecd, you're going to see what's working in tech. these two guys have the pulse on cyber and actually when this whole consolidation is going on in tech chrks is very real. i've done some reporting on this. >> you do lots of reporting. and i know that. >> thank you. >> jim, we'll see you tonight. >> all right. after the big win, maybe tomorrow after the big win, the eagles win. >> yes. >> that is not boring football. actually, thursday's not boring. it's just tough for those guys. >> i agree. >> they play -- they're just uber human those guys.

it's just hard to watch. >> it's hard to do. when we come back, a lot more on cuba after castro including the business and political ramifications. dow's down 50 points. this is where i trade andrs. manage my portfolio. since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities- trade confirmed- and i have global access 24/7. meaning i can do what i need to do, then i can focus on what i want to do. visit learnfuturestoday.com to see what adding futures can do for you.

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♪ good monday morning. welcome back to "squawk on the street." i'm carl quintanilla with sara eisen, david faber at post nine of the new york stock exchange. take a look at the markets. a little bit of selling here on some retail names although oil's up more than $1 as we start a busy week full of an opec meeting, italian referendum this coming weekend, jobs number, gdp and more. our road map though for the hour begins with cyber monday. mobile shopping topping a billion dollars for the first time ever on black friday. we'll go live to an amazon fulfillment center and speak with the president and ceo of the national retail federation. the end of the year quickly approaching with the trump rally hitting pause after three straight weeks of gains. we're going to break down where you should put your money ahead

of the new year. plus, cuba after castro. the world reflects on the passing of the former president. the focus turns to the future of u.s.-cuban relations under president-elect donald trump and the impact that will have on business. in fact, the world is reflecting on the death of former cuban president fidel castro while bertha coombs is in the little havana section of miami and joins us this morning with more. hey, bertha. >> reporter: hi, carl. despite the loud music it really is back to business here in little havana. but as you can imagine after people thinking about this for over 50 years the death of fidel castro prompted an emotional outpouring into the streets this weekend. it was emotional and at lot of people say they didn't feel satisfaction. they weren't necessarily celebrating his death but really marking the passing of an era.

many of them now looking at the transition here in the u.s. many of the cuban exiles here who supported donald trump are hoping that he is able to push this regime toward greater economic reform in cuba and perhaps even spur more social reform. >> i think that we should definitely have a more open relationship with cuba because it's been already too many years of a system not working. >> the thing is with these people you cannot trust them. if you sign a contract with them, they might say we're not going to follow this. >> reporter: indeed, donald trump has said he wants to roll back many of the provisions enacted by president barack obama by executive order over the last year. president barack obama of course visiting cuba last march, but attorney pedro freda who represents many of the companies and counselled many of the companies doing business in cuba under that opening says the

trump administration has an opportunity here because of this shift in power, this emotional shift in cuba. it could make more headway perhaps with havana on reform. >> this is going to be very significant in allowing somebody like raul who is much more pragmatist little more freedom of action. but more importantly other people coming up beneath him, the younger generations coming up in the cuban government and cuban society who really want change. >> reporter: sara, in many respects freyre says this is very similar to china after mow. allows forces to move forward, those forces he says are hungry for economic change. >> we'll see what happens under president-elect donald trump. bertha, thank you, from miami. bertha coombs. we'll have much more later on this show on the cuba-u.s. potential business story. but now let's turn it back to retail, cyber monday. more than 154 million people

shopp eped over the four-day sp but 44% of those didn't even enter the store. for more on these numbers released just over the weekend we are joined by president and ceo of the national retail federation matt shay. matt, welcome, good morning. >> hi, sara. good morning. >> so is the narrative here that more people turned out to shop but just spent less? >> i think the narrative here is that the retail industry and consumers had a great weekend. you know, we used to think of the black friday thanksgiving holiday weekend as the beginning of the holiday shopping season. and now it's really the midway point. if you go back to the october retail sales numbers, you saw how strong those were. i think that signals that people started their holiday shopping even earlier. and if we look at the number of people that haven't even started shopping for the holiday, 23%, which is the highest we've seen in our survey in many years, there's still a lot of shopping to be done. so this was a great weekend. it's sort of the middle of the game. maybe it's halftime. and we got a long way to go. we think there's going to be great opportunities for

retailers and great deals for consumers as well. >> so the figure that always gets cited in all of the articles and the stories was one that you put out early 3.6% growth in holiday sales this season. how are we looking so far in terms of meeting or potentially exceeding that goal? >> i think we're looking very good. you know, the overall consumer fundamentals remain very strong. we talk about all the macro economic indicators, unemployment rates, average hourly earnings, we know consumer confidence is very high. we've got the distraction of the election behind us. so i think consumers have both the ability and the attitude to go out and continue to have a very robust holiday season. and they've got the money in their pockets now. we see a little bit of growth in the economy. we see a much more optimistic investor community. we know what the stock market is doing. we're talking about the right kinds of policy changes here in washington. i think all of that is creating a sense of momentum, a lot of positive energy. and we think it's going to be

right on target to hit that 3.6% growth, which would be the best in a decade. >> but are they spending as much, are the discounts pretty deep? >> i think if there was one word to characterize this last weekend it would be promotional. it was a very promotional weekend. you saw deals on various kinds of items over 70%, 80% off. those are planned, thoughtful promotions. so this isn't the kind of steep discounting you see when people are holding too much inventory. as we come out of the recession, consumers have been trained to look for the best possible deal they can get. and now with the technology that exists with mobile phones and the ability to have such transparency of information, you know, those things have come together to really empower consumers. and i think create an environment where promotion is the word of the day and consumers are going to be very deliberate and thoughtful about making those purchasing decisions. >> so do you track the e-commerce sales as well?

and if so, which sites benefitted the most? >> i think what we saw and has been reported by other analysts is that bricks and mortar retailers who made massive investments in their online strategies really had a great weekend. and that's really starting to pay off. you know, sara, if we look at where the big online players are, eight of the top ten and 21 of the top 24 biggest e-commerce platforms are operated by bricks and mortar retailers. so bricks and mortar and online are really coming together in a way that is benefitting consumers, giving them what they want, where they want it, how and when they want it. and also creating opportunities for retailers to engage, to differentiate, to really deliver that product to consumers when they need it. >> so who's not benefitting? do you have any examples of companies that haven't made the transition online yet and that are having trouble keeping up with the likes of amazon? >> you know, i think we've reached a tipping point where, you know, once upon a time the biggest risk was to not make that leap. and now we're to the point where

the biggest risk is failing to make the leap. you know, once upon a time if you made it, you took a lot of risk. now if you don't make it you took a lot of risk. i think ultimately the winners and losers in this are going to be sorted by who was able to adopt the right strategies. and it's hard to pick now across industry segments or even within segments who's winning and losing. i think, you know, when retailers report their results and you see the final investor calls come out and see who did well and who didn't do well, a lot of that is going to have to do with who had the most robust platforms, who really planned for this season, who made the investments they needed to make. if you look at what's already been reported by some of the major retailers that had great weekends both in-store and online, i think those investments are really starting to pay off for them. >> i want to ask you about how different industries are reassessing the outlook as a result of the trump's win and the republican sweep. one of your mission statements on the nrf website is open markets for consumer goods. i'm just wondering if you have

any plans to lobby against some of trump's trade policies or at least the tough talk that we're starting to get on trade? >> well, you know, i think one of the things we have to keep in mind is you have one set of conversations when you campaign, you have another set of conversations when you govern. so it's early now to predict where we're going to go. we've already seen some things that were campaigned on that are maybe going to go by the wayside now as we get closer to the governing of the new administration. but listen, we all recognize we live in a part of a consumer society here. i mean, two-thirds of what goes on in this country is driven by consumption. when you import $2 trillion worth of goods to make this economy work, if you're going to tax those goods to bring them in here, the people who are going to be hurt most are consumers. and are going to be hurt most disproportionately are going to be the low earners in this country, the people at the lowest wage levels in this country. so if that continues to be an issue that gets legs and gets

proposed, we will be lobbying aggressively against it. i'm sure there will be many others. open borders and free trade are really some of the things that made this country great. those are successful policies we ought to continue to promote those policies with a lot of urgency and we shouldn't be going backwards closing borders and making it more difficult for consumers and our economy to prosper and thrive. >> certainly has helped the retail industry with sourcing and sales. thank you, matt. good to talk to you get some color behind the latest numbers. matt shay is the head of the national retail federation. and sticking with cyber monday, e-commerce giant amazon rolling out more than 75,000 sales this week. our courtney reagan is live from one of amazon's fulfillment centers in new jersey. good morning, court. >> reporter: hi. good morning to you, carl. even though the internet never really closes, it's like a store whose doors are always open, a lot of consumers use big event shopping days like cyber monday to fill up their carts. last year on cyber monday amazon said sellers received orders for

23 million items. that was up 40% from the year prior. and many analysts expect that it will still top that today. in fact, piper jaffray munster reports online today amazon will grow twice as fast as oh online retailers. amazon, munster says, will do about 2% of its annual sales just today. counting from the analyst says amazon is betting big on increasing volume not just today but going forward. opening 18 fulfillment centers just last quarter. five more in early october. that compares to 14 all of last year. now, the national retail federation does expect 36% of americans to shop at some point today, but deflation and deep discounts are making prices lower. so that volume is really going to have to pick up to increase from 2015. still, adobe thinks that it will happen. adobe said black friday online sales increased 22%. that was far more bullish than even their expectations.

ibm expects to see online sales grow by double digits today as well. for another record cyber monday. the biggest task though for retailers is to convert all this heavy traffic into actual sales. and build websites, by the way, that can handle it. you might remember last cyber monday target's website crashed under its best day ever. this thanksgiving did turn into its new best day ever. and its website held up. macy's website however did slow down. it was jammed under heavy traffic on black friday. now, walmart says that its web traffic increases by a factor of 10 between thanksgiving and cyber monday. so far so good, you may also remember that on prime day in july for amazon its website had some hiccups. but again, so far today things are moving along strongly. back over to you, sara. >> courtney, thank you. courtney reagan inside amazon. the end of the year is quickly approaching and our martin soi n

santoli has been working on worst -- >> make an effort to be contrarian here. obviously it's been a pretty good year. average stock in the u.s. is up double digits, but instead of riding momentum i'm looking at bombed out sectors that might be spring loaded for a big comeback in the next one, two, three years. for this column up on cnbc pro, i did use a few criteria including stops or sectors down at least 50%, preferably even more than 50% from their high. not necessarily year-to-date, but from their high. also, groups that are down two years at least preferably or even more. a lot of the academic research shows these are the kinds of conditions that can set the scene for kind of a mean reversion snapback move. my favorite example is coal stocks down something like 80% coming into this year, they're up more than 100% this year. so here are some of the groups i isolated. specialty pharma, very controversial. obviously after the valeant disaster and policy noise you have names like endo, teva,

perrigo, others like that that basically are trading at 3 to 7 times current year earnings. obviously lots of uncertainty. there's always uncertainty when you're talking about securities down this much. some countries out of favor, italy, russia and turkey. russia is still down big from multi-year highs even though it's come back with oil prices this year. obviously you have to be pretty brave right there. and some of the old media broadcast owners like tribune, gannett, obviously a lot of secular declines there but they do look like maybe they're washed out something like 50% to 60% losses from their highs. so that, guys, basically the areas i'm looking at. of course no guarantees. also my favorite, uranium, etf down 90% is down six years in a row. so unless nuclear energy goes away entirely -- i'm just pointing it out that that exists out there. >> i can't wait to hear the broker on that one. get me into uranium. >> a radioactive pick, carl. >> thanks, mike. good stuff. mike santoli. when we come back, the death of

former cuban president fidel castro opening the door for president tru president-elect trump -- take a look at where stocks are trading at this hour. dow within a narrow range but down 46 points. a lot more "squawk on the street" is after the break. at'd you got here? this bad boy is a mobile trading desk so that i can take my trading platform wherever i go. you know that thinkorswim seamlessly syncs across all your devices, right? oh, so my custom studies will go with me? anywhere you want to go! the market's hot! sync your platform on any device with thinkorswim. only at td ameritrade sometino big deal.shing my gums bleed. but my hygienist said, it is a big deal. go pro with crest pro health gum protection. it helps prevent gum bleeding by targeting harmful bacteria on your gums. left untreated, these symptoms could lead to more serious problems including tooth loss. gum crisis averted.

the death of former cuban president fidel castro leaving the door open for president-elect donald trump to makeover u.s. relations with cuba. our john harwood joins us this morning with that story.

good morning, john. >> reporter: good morning, carl. as with a lot of things involving donald trump, we've seen the evolution of his position on the death of fidel castro and the future of u.s.-cuban relations in a series of tweets. first of all, there was this on saturday after the news broke. fidel castro is dead, a celebratory tweet. then you had a second statement put out by the president-elect in which he was highly critical of fidel castro and said while the pain, the tragedy, the death that he caused cannot be erased, that his administration stands ready to help the cuban people along toward their journey toward prosperity and liberty. then we had this morning a tweet from donald trump saying this, if the cuban government is not willing to negotiate a better deal for the cuban people and for the united states, he will terminate the deal. that means the bargaining is now open. now, nobody expects any quick resolution of this. the immediate reaction of the cuban government doubtless will be to retrench and say they're

not going to be bullied by the united states. but this is a long process that is just now beginning. one early decision that donald trump will face, either in january or six months after that, is whether to renew the periodic suspension of the rights of grievance to bring actions against the cuban government for expropriation of assets in u.s. courts. i don't know if president obama will renew that before he leaves office, but that's a decision president trump will face. and of course no resolution on the top diplomatic advisor who will be by donald trump's side when he as president has to make those decisions. contenders for secretary of state still include mitt romney, who was trashed over the weekend by the president-elect's former campaign manager, rudy giuliani, the former mayor of new york city and also general david petraeus is a third candidate. there may be others as well that we're not aware of, carl.

>> john harwood on fifth avenue for us this morning. john, thanks. as for cuba, what are the post-castro cuba relations and will donald trump reverse the thawing of relations. let's bring in analyst at global risk consultant firm. good morning to you, joel. >> good morning. >> trump's tweets notwithstanding, it doesn't sound like you expect him to come back a lot on the normalization that's happened so far. >> well, ultimately donald trump was elected on the idea of allowing americans to make money again. yes, he won florida thanks to a large cuban american population, but ultimately there are a number of businesses that want to do business with cuba and that want to invest in cuba. and we don't believe that trump will get in the way of it. in the end he will increase his rhetoric, he will call cuba a brutal dictatorship, but also he will allow some businesses to invest if they want to and he'll allow some trades to carry on.

it's important to bear in mind that cuba will be a low priority country over the first couple of years of his presidency. mexico will be the big country on the agenda. and so he'll be able to allow the regulations that have been put forward by barack obama over the past couple of years to stand without leaving too much controversy on the matter. >> we've talked a lot about the hotels and airlines and certainly the cruise lines that have already made their way into cuba. is there a way for him to terminate this deal, which he obviously says he would do, while letting those incursions of business carry forward? or can the two not co-exist? >> well, i mean, there's a lot of uncertainty here. the real answer is we don't know. can he roll back all these developments now that all these airlines and hotels and other businesses have invested or committed to invest? can he allow these companies to continue to operate while

banning or suspending all developments and allowing other companies that wanted to invest to no longer invest? we don't know. i guess the first couple of years of his presidency will answer these questions, but ultimately we don't expect him to get in the way of the burgeoning ties that have been building since the normalization process since december 2014. >> right. raul of course has held the ball for awhile now. do you expect anything to change now that fidel is dead? >> well, i think there are two key aspects to think about here post fidel castro. first is that as you already alluded to, fidel's been out of the picture now for the past ten years or so. raul has been in charge. and we've seen the fact that he's been in charge that there's been no real influence or guiding hand by fidel by the fact that he has brought about some economic reforms.

he's allowed the economy to open up slightly. he's allowed the private sector to grow in some form. and that's not going to change now that fidel is dead. he was the leader, and he'll continue to be a leader. not much will change. however, there's also an important aspect here that within the bureau, the small group of cubans that rule cuba, we have two camps. we have the hardliners that are aware of the united states and want to retrench, that want to keep the socialist model. and the reformers that recognize the need for foreign investment, recognize the unsustainable nature of the cuban economy and want to increase the pace of reform. fidel was a hardliner. now that he's gone, a lot of the hardliners within their bureau will lack support, lack guide and perhaps reformers will find their voice and may see increase in the pace of reforms now that fidel's gone. >> just per donald trump's tweet about an hour and a half ago, he

did say unless cuba's willing to make a better deal for the cuban people, the cuban american people and the u.s. as a whole, i will terminate the deal. what would that look like in terms of president-elect donald trump's demands and if we could get a deal? >> well, i think what we're seeing here is donald trump nodding to his cuban american lobby, his support in miami, and saying that cuba needs to enact some kind of change. now, we know that cuba's a one-party state. they're not going to allow much pluralism within the system. they're not going to allow too much dissent. but if castro does pay lip service to human rights, if he does allow some protests to go on a bit longer than they have been let to go on, if he releases a bit earlier than he has been, that will allow donald trump to say to his cuban american population i've made a deal, i've enacted change, cuba

is now freer than it was and that will allow him to continue to allow businesses to do business with cuba. so i believe that the deal, or the compromise that we're likely to see is going to be somewhat of a sham in many ways. >> we're going to be watching for truth in that one for sure. joel, thank you so much. joel ross. thank you. >> thank you very much. coming up on the show, the holiday shopping season is just beginning. with more than 122 million people expected to buy online today, we will speak with the ceo of bonobos and former ceo of best buy when "squawk on the street" comes right back after this quick break. the dow is still down about 50 points. and i know a thing or two about trading. so i trade with e*trade, where true traders trade on a trademarked trade platform that has all the... get off the computer traitor! i won't. (cannon sound) mobility is very important to me. that's why i use e*trade mobile.

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call now, request your free decision guide and start gathering the information you need to help you keep rolling with confidence. go long™. ♪ welcome back to "squawk on the street." the trump rally's taking a pause here. let's send it out to dom chu for a market flash. good morning, dom. >> good morning, sara. gold miners are surging as the precious metal rebounds after hitting a nine-month low in friday's trade. the vaneck ticker gdx up about 2% in early trading still down about 15% just this month alone.

meanwhile gold prices down almost 8% over that same time, but a pullback in the dollar is helping gold regain some strength. at least in trading so far today large components in that etf like barrick gold, newmont see if that trade will continue. back to you. thanks, dom. retail in focus after the big holiday shopping weekend. the nrf reporting black friday online sales topped $3 billion for the first time ever. we're going to break down bricks versus clicks with the former ceo of best buy in a moment. before danny got what he was dreaming about for the holidays. before his mom earned 1% cash back everywhere, every time. [ dinosaur growls ] and his dad earned 2% back at grocery stores and wholesale clubs. yeah! even before they earned 3% back on gas. danny's parents used their bankamericard cash rewards credit card to give him the best day ever. that's the joy of rewarding connections. learn more at bankofamerica.com/getcashback.

good morning everyone. i'm sue herera. here's your news update this hour. a united airlines jet has been forced to make a landing east of tokyo. an unruly passenger on the flight heading from chicago to hong kong tried to enter the cockpit. the man told police that he has taken several types of

medication. flags are flying at half staff at embassies and on government buildings in cuba's capital havana in honor of cuba president fidel castro. cubans will file past castro's ashes today. his body was cremated on saturday. italian firefighters, a police video of damage caused to the towns by landslides. they were triggered by floods that hit northern italy in the past few days. and apparently only in canada. take a look at this. it often rains hats when the calgary hockey team scores its first goal, but how about stuffed toys? this year's annual teddy bear toss saw more than 17,000 fans cascade just under 24,000 cuddly soft little animals on to the ice. it's done for 60 local charities and they raise a lot of money. that's the news update this hour. i'll send it back downtown to you, carl. >> sue, thank you very much. sue herera. more than 122 million expected to shop online today.

after that big holiday shopping weekend both in-store and online national retail federation reports that black friday online sales topped $3 billion for the first time. mobile up 33% year on year. how are the big box retailers competing in the e-commerce space against amazon? joining us this morning is the former vice chairman of best buy and ceo brad anderson. brad, good to see you again. welcome back. >> oh, great. it's great to be back. >> you know, a lot's been written about how best buy has managed to compete in this new era. i wonder what you make of those write-ups and how much you had to do with that. >> very little. i retired from the board this past summer, but i've been really thrilled to see what's happened at best buy. obviously the stock performance has been great and it's gained market share and doing very well financially. but i'm even more excited about what they're talking about doing from a future standpoint as they compete in the emerging world. and offering new services for

the customers. i'm kind of proud to have been at best buy and very excited about its future. >> what specifically would you say they are doing? and is it something only an electronics retailer can do? >> well, i think the first thing they decided to do was they had to get structured correctly to be able to compete with especially the pricing structure. so they had to get cost structure in line for how competitive the market has become. more important over the longer term they've got to develop value propositions that online suppliers -- pure online companies cannot deliver. and there's so much room in the consumer electronics space because there's so many unmet customer needs. there's so much stuff we can do with electronics that we're not doing right now because of the interface and all the technology problems that are presented. and if best buy can move to solve some of those things, it will have an absolutely unique position. i believe it will do that. >> is there any -- can apparel retailers or any other kind of retailer take lessons from that?

>> yeah, i think all -- most brick and mortar retail has been very slow to respond to the challenge that's coming from online. i think that occurred in a sense because the warnings of what online would do it took about five years from the time the people expected it to really have the impact it had. and i think people got complacent. and the kind of energy that needed to be presented for most retailers, especially take advantage of the -- you know, on brick and mortar retailer because of being local has some natural advantages, but it's got to use the things that can be provided by the internet in addition. and i think almost all the strong surviving retailers either have done that or are increasingly doing that. and they're getting better. but it's probably later than it should have been. >> within electronics, brad, i wanted to ask you about wearable tech and fitness trackers. have we already seen the peak on that? or do you expect it to come back at all this holiday season?

>> i don't know whether we've seen the peak because -- but it will depend on new applications. one of the things i was at best buy for 36 years and we never had the same product hot from one year to another. because it's such an innovative ecosystem that customers quickly -- and the product quickly commoditizes that you don't see the same product come back. it will have to come back in different formulation. but i think the health needs are there. and there's all sorts of applications for health that can be created in the future. >> who's innovating the most right now in the electronics world from what you're seeing? is it an apple, or are you still -- you know, i look at cyber monday and all the best deals are still on television. >> yeah. i don't think there's a fundamental innovation that's happening. well, actually probably some of the best innovation is happening in television with 4k and l.e.d. so, i mean, television product is amazing these days. but there's no sort of profound

innovation that happened with the iphone, i don't think it's happening currently. i think you'll see that it's going to take some new products and maybe a couple years before we see something similar to what we saw five and ten years ago. >> finally, walmart, it's been over a year since they really took a pounding, took some medicine and restructured the way you're describing in an effort to fight amazon. i wonder when you pit those two together, if you see the gap getting smaller larger. >> i think amazon is an incredible company. it's a company engineered for the digital age. it has in its core culture constantly making changes adapting, making mistakes, using the bottom of the organization as well as the top of the organization to innovate. it's a great challenge it presents to companies like at best buy and walmart. and i think that so there's a cultural implication that means

you really have to change the way you do things in order to compete effectively with amazon. and as you see with i think with both best buy and walmart it takes some time to get there. and they're going to have to adapt their cultures to be able to move as fast as amazon moves. the good thing about that for both companies is having to compete and having to win against amazon means that they've got to make -- they've got to accomplish that. and i think both companies are likely -- much better companies and likely to compete very effectively over the long haul. a year isn't enough time to see that kind of change. >> right. no, it's definitely a slow motion story even though probably wish it would happen faster. brad, it's good to see you again. thanks for the insight. brad anderson. >> thank you so much. >> talking holiday sales, formerly of best buy. i want to get back to sue herera this morning with more of that breaking news out of ohio state, sue. >> indeed, carl. here's basically what we know, it is a still developing situation at ohio state university. the university about half an hour ago said that there was an active shooter on campus. they put that on their twitter

feed, advised students to shelter in place, to run, hide and fight. that was their guidance. now we have from the columbus -- that's our columbus affiliate right there showing us that live picture. the columbus fire department just came out with this note, seven people have been transported to hospitals, two in stable condition at grant hospital, two at ohio state university with their conditions unknown at this time, three will be updated later. their conditions are also unknown. we don't know what hospital they are at. but it's a total of seven people who have been hurt in this particular incident. once again, ohio state university offering a shelter in place tweet earlier. it's a still developing story that we will follow, but we do know that seven people have been transported to local hospitals at this time. carl, i'll send it back to you and the crew downtown. and we'll keep you posted as more develops.

>> all right, sue, thank you. we'll continue to keep our eye on columbus. take a look at where we are on stocks right now. the dow's down about 50 points. a few minutes ago we had recovered about half of those losses. we're down again. united health and nike are the biggest losers on the dow. s&p is down about 0.25%, financials which had been big winners out of the election are the big losers today. and the nasdaq is down. the least of the three technology is outperforming just a bit here. much more ahead on "squawk on the street" when we come right back. american express open cards can help you take on a new job, or fill a big order or expand your office and take on whatever comes next. find out how american express cards and services can help prepare you for growth at open.com.

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welcome back to "squawk on the street." as you can see markets mostly lower, actually near lows of the session so far. financials standing out as the worst performing sector in the

s&p 500. big laggards today include metlife and er-trade as well. both down about a percent in trading so far but still up 17% to 18% respectively this month, the best performing sector since the election, sara. back over to you. banks are weakening as yields go south, thank you, dom. we'll go now to rick santelli on that in chicago at the santellie exchange. >> good morning, sara. like to welcome my special guest today. an andy, thank you for taking the time this monday morning. >> rick, thank you very much. always a pleasure. good to see you, buddy. >> all right. when i look at one of the reasons interest rates are moving higher, i hear it's the shift from deflation to inflation, two-part question. did i miss the deflationary aspects? or was there actually the boogyman getting out of the closet? in terms of inflation, the fed

has done so much, we're basically at full employment now with the potential future of much more economic activity. where does the fault lie and how aggressive will yields move up should this inflation grab harder? >> well, rick, we've already moved 100 basis points in less than five months in the 10-year, so i think, you know, 50 of it before the election, 50 cents. i think the markets have gotten a little ahead of itself. i mean, inflation is definitely turned, but now comparing against the opec lows of a year ago. and i don't think inflation is that profound, nor do i think the trump stimulus will start off with a bang. i think it's going to be a slow start up. so i think the market's kind of gotten ahead of itself. and i always look to the europeans to develop the next crisis of which i think a new one will develop this weekend in italy. >> well, there definitely is a major reversal in the relative value trade as we are now approaching 220 basis points separation between 10s and

bunds. what do you think of the italian referendum? isn't it getting a little old that we constantly see the need for reform, we never really get the reform, all we get is kind of a stability of current conditions. anything going to be different after the referendum even if the referendum passes? >> well, right now our odds are that it's going to fail. and if it fails, the ft ran an article today that eight italian banks are at risk. but i really think the bigger thing is depending on the vote on sunday, i think it will be how draghi addresses it next week at the ecb meeting. we think he has a plan one, a scenario one and a scenario two. scenario one is if it passes, and scenario two is if it fails. and if it fails, i think he's going to come out with all kinds of different stimulus and be much more dovish than the world is looking for right now. and i think that's why -- >> andy, mario draghi has done everything including the kitchen

sink. that doesn't really change the balance sheets of these banks, does it? >> no, it doesn't, rick, but i think he's going to try to figure out ways to allow the banks to make money in an environment of low to negative interest rates and that hasn't happened as of this point in time. >> well, faux fix is result and wider spreads, i imagine that the u.s. markets remain stable with even higher rates against those weak counterparts. thank you for taking the time, andy. now we're going back to sara. >> all right, rick, thank you. when we return, mobile shopping hitting a record. we'll speak to the ceo of bonobos, how he's planning on keeping up with online shopping this season. much more ahead on "squawk on the street." stay with us.

after a record number of consumers shopped online versus in store on black friday, what kind of business model should retailers be opting for at this point? joining us now is the founder and ceo of bonobos, men's retailer, e-tailer. andy dunn, welcome. >> thanks for having me. >> so as more and more traffic is moving online for some of the traditional retailers, does that hurt you because they are moving away from you, or is it arising tide? >> everyone thinks about it as two different businesses, online and offline.

at bonobos we think of it as one thing, so our stores are really e-commerce show rooms where you get fitted and styled and we're seeing as we open stores, we have now 30 physical locations, but they are really different. they are the first of their kind clothing stores with no clothing stock, so it's really a focus on a great service, great customer experience, and what we're finding is it's really just one business and you have to be in both places for the consumer. >> but what are you seeing in terms of traffic and spending numbers so far this holiday season? >> black friday was awesome. we feel really fortunate, we saw about five times the mobile traffic we've seen historically and from a website perspective twice the foot traffic in the stores, so it was a great day and we're hoping for a big day today with cyber monday. 30% off sitewide, up to 60% off, and hopefully it's a day twice as big as black friday. cyber monday, of course, the super bowl of e-commerce, is the biggest day of the year. >> what have you found since you opened these physical locations where people can go and look at things and try them on and how

do you measure the success? to the extent they are not selling out of there, you're simply measuring it by e-commerce volume? >> what e-commerce has taught is it's different from the moment of the action, so taking all the inventory out we're able to offer a ton more fit and much better service and 91% of the sales we attribute to our guide shops happening in store. 9% within a week. so we're seeing the guide shops lift the entire market. new york we have five guide shops now, just opened 52 7bd and madison, down on crosby street, brookeville place, and at our headquarters. the whole market lifts as we open more and more guide shops. >> when do i get it, how long do i have to wait? >> on the east coast it's usually within a day, maybe two days at the most, you know, we're fulfilling in the northeast. if you're on the west coast we're upgrading to air to get it to you more quickly. >> i'm wondering about your

business, unilever bought dollar shave club, is that the end game? >> well, michael duben and i had a date last night, dollar shave club, he's an amazing guy, really funny. he really set the gold standard that you can build a business in a space that isn't just worth something for 10% of the business or 20% of the business, but where the whole thing is worth a billion dollars to dollar shave, so it's an exciting time for e-commerce. we're optimistic we're building a real business, not just a flash in the pan sales story and venture capital story in e-commerce. >> you are profitable, correct? >> we're profitable now, which turns out is a goal of the business, so we're excited. with all the attention oh, has gotten, very few companies have made money. >> david wants to know what's the most in style mens wear piece. >> that shirt a big seller? >> smaller seller, we have a few

left. it's about the jet setter, awesome suits, stretch shirts, denim. >> denim not at leisure? >> although we just launched a line called good sport. we're dipping our toe in the athletic line right now. >> andy dunn, thank you, good to see you from bonobos. we're going to break down the peak season for delivery giants fedex, ups, and the postal service straight ahead. why pause a spontaneous moment? cialis for daily use treats ed and the urinary symptoms of bph. tell your doctor about your medicines, and ask if your heart is healthy enough for sex. do not take cialis if you take nitrates for chest pain, or adempas® for pulmonary hypertension, as this may cause an unsafe drop in blood pressure.

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1.8 billion packages, that's how many deliveries expect to make combined between now and new year's. our moore kban brennan joins us with a look at what to expect. morgan, how the shippers are dealing with it. >> that's right. so the short answer here, expect it to be another record breaking peak shipping season. it's already off to a strong start. we have over $3 billion spent online on black friday according to adobe, with a similar sum expected today, cyber monday, so ups, fedex, and the u.s. postal service all expect, as you can see behind me, double digit increases between now and the end of the year.

ups, 700 million packages, that represents a 14% increase over last year. fedex, a 10% increase, which translates into upwards of 355 million shipments. the usps, 750 million packages, or 12% more. all three have hired a combined 185,000 seasonal workers, they've invested billions of dollars. ups and fedex have opened new facilities. mobile villages at ups, at fedex we have centers focused on oversized items like tvs and trampolines, which consumers are increasingly buying online. fedex is also adding 30 new planes to express, and the postal service is expanding sunday and christmas day deliveries, especially for its biggest customer, which is amazon. speaking of amazon, ship matrix estimates 220 million amazon packages will be shipped this holiday season. that's a nearly 30% jump from last year. the usps moving two-thirds of that. as you can -- well, when we pull

the graphic up you can see, but the big question, can these companies actually deliver? we've got more packages, which means more potential risks to the networks and thus to profits. it's a situation we've seen play out in years past. shares of fedex and ups slightly lower, but trading near all time highs. guys? >> morgan brennan, thank you, on the shipping story. with that we're seeing the losses pick up steam, the dow is down 80 points and we'll send it to you, carl, for "squawk alley." >> good morning, it's 8:00 a.m. at amazon headquarters in seattle, 11:00 a.m. on wall street, and "squawk alley" is live.