it looks good. it is monday, december 19, 2016. and "squawk box" begins right now. live from new york where business never sleeps, this is "squawk box." >> good morning. welcome to "squawk box" on cnbc. i'm andrew ross sorkin along with joe kernan and michelle caruso cabrera. overnight in asia, we'll show you what is going on there. you're looking at a bit of a down picture. pretty much across the board, finally, we'll take another look at what is happening in the european markets. we -- i don't want to argue we are keying off of that because that's a mixed picture. finally, take a look at crude. if we could, you're looking at wti now at 52.19.

the markets sold off marginally. it's the first real anything on friday after a little geopolitical scare in chi in. but then we had tweet action over the weekend and things seem to be a little more positive. >> give them back the drone. >> it looked to be up on friday. and it looked like it this morning. we'll see what happens at the end of the day. >> it seems like the dollar backing off a bit has undone a lot of stuff. >> i like the way he said, keep the drone. it's a stupid drone, you know? i don't know if it's that high-tech, but it's like, keep the drone, but we're going to remember this. the thing about those islands, they are weaponized. >> we have to be careful. >> i think you're right. we'll see. definitely a provocation. here are the big stories we're watching today. in corporate news, apple intends to formally launch an appeal against the european union's 14 billion tax bill. they are going to do that this week. apple's general council says the company was singled out because

of its success. ire upland is joining them challenging the ruling accusing the european commission of overstepping their bounds and misinterpreting irish law. iran and airbus finalized the 100 jet deal expected to be signed in the coming days. and timing is key since the aircraft delivery could come before the inauguration of president-elect trump. he voiced opposition to the nuclear deal and could derail the purchase of airliners with new sanctions since both airbus and rival boeing rely heavily on the use of american parts. iran finalized a similar deal with boeing just last week. samsung plans to use rival lg chemicals in the smartphones starting next year according to a korean newspaper. the move would diversify samsung's supplier base following the failure of the galaxy note 7. volkswagen is -- it has my name in there. >> oh, it does. it says anchor there. it's generic.

it is all yours. >> go on the rundown. >> it's yours! >> go on the rundown. see, if you follow along on the rundown -- >> i did follow the rundown. >> if it's not there now, you can see what is coming up and who is reading. >> i do that. >> and you won't be confused. >> did anyone see the ceelo video over the weekend with the samsung note 7 that explodes next to his head. >> no, i didn't see that. >> no, there's a video, it was caught on tape, kind of thing. >> it's not a new music video. >> no, it's real. he's sitting in a studio with the phone, and all of a sudden, you think he's going to be injured. next thing it explodes next to his head. >> ceelo? >> the singer? >> yes. i really like him. >> we'll get you video and do a check-outs of the video segments we do. >> the ceelo video samsung phone. i paused. i know i'm a guest here.

it said anchor, i assumed it was you. >> volkswagen is facing a deadline to tell a federal judge in san francisco by the day whether they reached a deal with u.s. regulators and attorneys. and it is all over the diesel admission scandal from last week. the two have made substantial progress. and postponed a hearing to give them more time to negotiate. "the wall street journal" is reporting that the carmaker could spend an additional $1 billion to settle claims that weren't covered under a previous $10 billion settlement for the emissions cheating scandal. ompblts t on the economic calendar, wednesday, existing home sales. the thing is stuck. look at that. you go ahead and read, because the thing is broken and moving along no matter what. and i'm starting to rush. and i'm like the federal express guy. i think i can do this. i think i can do that. and why am i -- i'm going to get a hernia. >> we're talk about the

teleprompter. the speed of the teleprompter. >> there it goes again. wednesday, here we go again. i'm going to drive them crazy now. wednesday, well, look for november existing home sales. thursday we get jobless claims. and then november durable goods. the final estimate on third quarter gdp and november personal income is on friday. on friday it's november new home sales and december consumer sentiment. and several companies are reporting results this week including carnival, darden, general mills, fedex, nike and bet band and beyond. and fairfax financial agreed to buy allied world assurance for $54 per share. it's a $4.9 billion deal in cash and stocks. fairfax will pay $10 in cash and $44 in its own stock to allied owners. they operate with an 18% premium

to all lied's friday closing price. and blackberry promises to open in canada today. the company is expanding the qnx facility to get in on the race to divulge self-driving technology. they power entertainment systems in millions of cars. and justin trudeau is expected to attend today's launch. >> cnet thinks it is a publicity stunt by ceelo to launch his second personality. >> some were wondering if it was true. >> you know how marshall mathers, ceelo is apparently launching a new person. >> whether the video was real or fake, however -- >> it was meant to generate publicity for the new person. >> didn't puff daddy do that? >> he changed his name. i don't know if that means a second personna or not. >> he says, i'm alive and okay.

i'm emotionally disturbed by those who are worried about what they saw. >> it could be fake news. >> you know who else is alive? carlos danger. he started out as wiener, which was not a great -- he used to do the ding. whenever we did the wiener -- every time we said "wiener," they would do a ding. i'm telling you, i could not -- i couldn't look away, but i was so -- and then i made my wife watch it. and my son -- it was not -- was it not unbelievable? >> this is a comeback movie. >> it was too late to tell them you can't show it anymore. as it's declining and you're watching hulu -- it was a sad video. >> you know who else had a second one? >> i think m.c. hammer tried to come back with a different name.

he wasn't puff pants anymore. are we ready for the -- so ceelo is going to be who? >> gnarly davidson. >> you get entertainment. >> how would you make this? >> i don't know. >> we will find the video. >> investigative minds know. >> where did you see this? >>online. on social media. now to italy's -- >> i thought you were harassing electors all weekend, weren't you? now to italy's banking crisis. the company's ten-year bond yield falling to one-month lows earlier this month after mote dei paschi raised private money in order to attend a state bailout. banks would offer new shares for sales between today and thursday.

the stock is lower by 9% this morning. back to the markets, the dow got within 50 points last week. and the dow had its sixth positive week in a row dating back to the election. and joining us is darrell cronk, chief investment officer of wells fargo's wealth and investment management. also joining us is sarah hunt from alpine funds. darrell, you call it a love affair with trump in the markets. and sarah, you quantify the -- what we're getting already with some of trump's -- you think we already got 50% to 60% of the tax reform in the market already? so now it has to happen to justify what we've already gotten, is that what -- >> this is looking just as a certain sector of multiples and looking at if you bake in the tax cuts, what that would do to earnings. if you're seeing some of that,

well, if you look at some of the areas in the industrials and some of the transports especially -- >> it's already in the market. >> it's partially in there, yeah. you've started to see those stocks move higher. and if you look at the multiples, you can say, if you put that in there. >> are you implying if there's a delay or if it doesn't happen as expected, that -- it sounds like you're saying we've already gotten paid for what hasn't really happened and therefore there's risk. >> i think you also have partially reflation on the back of the plans we have for some stimulus. so it's -- what we were just looking at is, if i just take what the tax cuts are and put new earnings in, have the multiples already expanded to where they were before? and the answer in some of the cases is yes. but also you're getting paid on the back of the idea that we're getting a bigger inflation trade and better stimulus. if was don't get some of that -- >> so it is not just, once again, this is a drinking game, an animal spirits where you've

got, just consumers seeming more confident, some small business guys seem they will hire more. i know the first lady thinks we're in this period of hopelessness. i guess she doesn't watch cnbc or something because she's not seeing the markets. the markets don't seem that hopeless. >> she doesn't like to live without hope, yeah. >> so we had eight years of hope and change and now without him there's going to be the country basically hopeless, i think. >> apparently. >> we're going to see that. >> some people. >> that's right. all those people you have talked to. >> now they know how we felt. >> exactly. >> what do you think? >> i would say, i would agree with sarah largely with the exception of, i'm not sure the real story is the equity markets overextending. i think we'll see profit taking in january on the hopes of a new tax regime. i think the real story is the bond market. to us, rates luke like they backed up too much. and frankly credit is getting really expensive right now. so credit spreads have

compressed considerably, particularly in the lower grade areas. and so to us, they are starting to look a little rich. so my eyes are as much focused, joe, on dollar and rates for the next couple of weeks here as we move into january. more so than the equity market move of late and, you know, terrible concern about that pulling back. >> doesn't it have implications for the equity market? >> oh, it absolutely does. >> and ultimately we have to get back to the sell stocks based on what they are doing. >> but what is driving what is the question. so to me, it's as much about where rates are trending to will help and face what happens with the equity markets into q1. >> amazing, it's sort of an uneven move higher. when we got to 250 for the first time, it was like, wow! and then back down to 240. then we got 260. now we're not just at 3% on a daily basis. same with the dollar, it looked like we were headed right to

parody with the euro. but then -- right, anything sort of moderates in the move. so you think we have seen the highs on the yield or are getting close? >> well, we will probably be at this level or a little less at year-end next year. >> year-end of 2017? >> for the ten-year or the dollar? >> for the ten-year. probably somewhere in the 2.50, give or take. >> that's a low rate. because now the fed is forced to move. >> remember, you haven't had growth reset. the federal reserve at their meeting the other day just came out and said, 2.1% u.s. gdp growth reaffirmed their target. most of the street has not reset growth expectations even as the dollar strengthened rates and they have backed up. >> so when we ask for days on end when the rise and rates start to threaten the stock market, you don't think any time soon? >> yeah, we don't think any time soon. >> we think it's probably a less

good year in 2017 from a total return in the stock market as we enjoyed in 2016. but the one thing i would say is, rates can move pretty quickly. and remember in q1, we'll have a reset of some inflation data. so remember oil bottomed to it in february, so the year-over year comps in inflation on the run rate are going to start to build there. so that may cause concern for the bond market. >> when you say the market is pressed into the corporate tax cut, if we get that, does that mean then we get another 50%? >> i think there's still room for a lot of the multiples to move if you get that tax cut. because people base things on earnings and multiples. if you do see those changes, and that is sector specific. a lot of sectors get more earnings from the u.s. and therefore the benefit is better to them than sectors already under lower tax regimes. we were talking about that earlier before i came on.

and i think that that is going to be differentiation there. but there's room to move if you get the tax cuts because i think that the benefits will be permanent. people will expect that the tax cuts will stay. so therefore the earnings will be higher going toward. it's not just a one-time thing. because this isn't -- the way they are talking about it, they are talking about changing the corporate rates. not one give back or another. >> and so the movement to the stock market over the next year could very much be driven by the imaginations of what's happening in congress on a daily basis. >> absolutely. you talk about regulatory reform, too, so in that case for a lot of banks, that would be an earnings boost to them as well. because they have very high compliance costs and other stuff. so there are a lot of areas in which they are talking that are very much dependent on how they all get along politically and how we watch that. so i think that what is going on politically could have a big effect on the markets. >> it's early. the electors meet today, it

seems early. >> gnarly davidson. >> i saw someone that said he picked that ridiculous name, carlos danger, instead of his previous name anthony weiner. they are both -- i'm still scarred by that. i'm like going to watch it again, too. >> why would you? >> because it was shakespearian. >> "hamlet"? >> he cannot help himself. his parents are mortgaging their house to send him out for his sexting problem. >> it's a story you enjoy. >> i enjoy this. >> it's "vanity fair" about huma and her role in all this and what has happened to her -- this just happened. >> andrew, you know what i'm talking about? he was winning the mayoral contest and she was right with him and saying, i want -- my

husband is better for new york city. and then watching that slow -- it was like "macbeth." it was unbelievable. >> it was a train wreck. >> i couldn't look away. but as we got further, did you see larry o'connell -- >> i saw the whole thing. >> we can't go over the whole three-hour documentary. but i want to show the larry o'donnell thing. >> did you see this again? >> i saw it over the weekend. so you have not seen it. you are making fun of me seeing it recently. >> i don't want to see a movie about propaganda for anthony weiner. >> you think it was propaganda? >> it was intentionally intended to be. >> it was not good propaganda. >> we are so far from the topic.

coming up, when we return, we'll talk about president-elect trump picking his budget chief. we'll get the latest from the transition chief right after this quick break. we are back in a moment.

welcome back to "squawk box." results just in from home builder lennar. revenue is above forecasts. new orders were above 9%. and 12% by dollar value. and in media news, the force is still strong at the box office. disney's latest "star wars" movie topping the competition "comscore."

they say "rogue one" took in $155 million in u.s. and canada. they was only trumped by last year's "star wars" movie "the force awakens." i don't know what you think about that in the first weekend. "rogue one" is a stand-alone spinoff following a band of rebel fighter who is play a key role leading up to the event in the original 1977 "star wars" film. and worldwide the movie made about $290le b lle billion. i'm totally confused. >> did you see the first movie? >> not really. >> you never saw the original "star wars"? >> no. when did it come out? >> 1977. >> i was in college. >> you wouldn't remember it. >> no, i would remember it, but i think i was a junior. so it was for people a little younger. >> got it em blazened in my mind, the first "star wars."

that bar scene at 12 years old, i was like, how did they do that? >> i like the way what's her name looked. >> princess leia? >> i like that. >> so did harrison ford. >> apparently he couldn't express that. >> i think it is really brutal to reveal that stuff. let's talk politics. it is a big day, you know n the political world. >> that's what i hear. >> i know you thought i was -- >> be a hero. vote for evan mcmuffin. >> we'll talk about the electoral college and get the administration view in just a moment. in the meantime, the elector college votes today to finalize

donald trump's presidential victory. we have the latest from eamon javers. good morning to you. >> reporter: good morning. electoral college votes are voting today. we'll watch this more carefully than we intentionally tend to watch the electoral college votes, which are a formality. here's what will happen throughout the day. the electors, 538 of them, are going to meet in their individual states. they will cast votes for president and the vice president today. they are going to deliver the statistic in a vote to the national archives and to congress. now the house and senate will meet on friday, january 6th, to count the votes and decide who the winner is. electors across the country said they have been subject to enormous pressure getting calls to urge them to vote for one candidate or the other. we expect that at the end of the day today, donald trump will have won. we won't know the results until january 6th officially.

and that's when joe biden is the head of the senate will preside over that vote counting ceremony. so we'll have to wait until then to see. at that point, some members of congress can bring up any objections they may have. if there are in so-called faithless electors today, electors who do not vote the way the state voted, then those votes can be challenged in congress in january. so we'll wait to see how many electors are succumbing to pressure not to vote for mr. trump. we expect most of them to vote the way we expect them to vote. but we'll have to wait and see. >> eamon, thank you for that, sir. >> you bet. >> great to see you. coming up, the homestretch for the retailers and the busiest day for shippers. we'll see how major brands are stacking up and whether deliveries will make it on time for christmas. an as we head to break, a look at the s&p 500 winners and losers from last week. ♪

what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods?

the value of capital is to create, not just wealth, but things that matter. morgan stanley ♪ welcome back to "squawk box" here on cnbc. the u.s. equity futures are looking up after what turned out to be a down day on friday after

we had a little bit of what we're call a curfuffle with china. the national gallon for regular gas jumping 6 cents to $2.26 a gallon accord on the lumberg survey. the average seasonal price is $2.48, which is 4 cents higher than two weeks ago. you know, they assume that we're spying when we're over there. that's just their idea. is there any way that this drone could have been doing anything other than -- what was it doing in the ocean? >> i hope not. there are submarines down there. it's supposed to be monitoring submarines. >> it's checking ocean conditions. >> oh, yes. is that true? >> i thought it was doing an amazon delivery. >> they are testing whether they can deliver over there. meanwhile, sandy, you saw the guy that used to work with

us, he was talking about tunnels. where is the flying cars, which could mean we don't need tunnels? we were promised flying cars. tunnels? we're going backwards? >> elan musk got in a traffic jam and said he has to build a tunnel. >> i have been a bridge and tunnel person for a while. you don't want to be called a tunnel person that's coming into new york city, right? where is the fine -- >> i thought he had a plan for a tunnel to get across the country really fast. >> is there a hyper loop? >> you know, eminent domain, you have to go over. you might have to go under. i don't know. >> the jetsons -- he's setting his sights there. to sports and "sunday night football" on nbc, the tampa bay buccaneers took on the dallas cowboys. they have the best record in the nfl. dax was back, i heard. i was up a little bit late. i didn't see this.

i was actually watching "the sound of music." for some reason, i get emotional. i don't know why. ♪ doe a deer >> i don't think he thought it was that great of a movie. tampa bay had one last chance to tie or win the game. but dallas intercepted the pass late in the fourth quarter. the cowboys went on to win 26-20 improving their record to 12-2. they lost twice to the giants. i watched that game. the giants looked pretty good yesterday. the new england game was the most boring game i have ever watched in my entire life against denver. i can't believe i put in -- i want those two or three hours back. but yeah, when he's mad at the kids and julie andrews really yells at him. he sees he isn't spending enough time with liesl and the boy wants to grow up. he comes and sings with them. >> that's the song about growing up, yeah.

>> when he sings, that is when -- my kids are like -- no, no, it's smoky in here. >> hi. >> that's morgan. >> do you feel for something like that? >> my favorite things is a song i sing with my daughter on a nightly basis. >> so many things are in this movie. >> it's the biggest day of shipping for the u.s. postal service. she's here to look inside the biggest shipping hubs. >> i am. but there's stuff i want to say about tunnels and air space and drones. there's so much i want to talk about. but we'll talk about shipping right now. we are. we're going to talk about that. so it is full-blown crunch mode for ups, fedex and the u.s. postal service as the next several days will be the toughest of the entire year. so today, likely to be the busiest day for ups. it will be one of the busiest at fedex with both carriers handling double the package volumes. it will also be the busiest

mailing day for the u.s. postal service. all three expect holiday volume growth to surge by double digits over last year for this holiday season. they expect to deliver over an estimated 1.8 billion packages. all three started prepping back in january. new facilitiefacilities, new tr technology, mobile sorting stations, new planes and trucks. these companies are pulling out the punches to get packages to doorsteps including renting trucks, doing sunday deliveries. and in the case of fedex and the postal service, you have christmas day deliveries. even in the case of ups using railroads like csx. the question will be, is it all going to be enough to get these deliveries done on time? and without cost climbing? that will be a big question, the question that sent shares of ups and fedex lower last week and becomes a bigger question as last-minute online shopping potentially spikes over the next couple of days and spikes as we get some bad winter weather as we saw earlier this weekend in the new york metro area.

>> you want to talk drones and tunnels in the meantime? >> well, i don't. i mean, we talk about flying cars, but then you've got the air space, you've got airplanes and drones being tested. the tunnels make a lot of sense. >> it's damp and cold and dark. >> well, it has a potential infrastructure bill. that could be a good place to put these tunnels. >> i don't want to dig. i want to soar. >> there's new technology to dig down there. >> i know. >> thank you, morgan. >> sure. that was a great set up to talk about the retailers. who is doing all the shipping? we'll bring in bob dole. retailers were hammered last week, partly because of the way the tax bill is playing out. what do you think happened and why? are you worried about it? >> well, they had a tremendous run over the last, you know, few weeks since the election. there's a lot of factors playing

in. when you think about the tax implications, lower corporate tax rates, they have helped some of the domestic retailers. the lower personal income tax rates are pretty encouraging from that perspective, but there is also this looming discussion around tariffs and what is happening with higher tariffs and how that would impact trade. >> have you started paying attention yet to what paul ryan is talking about dealing with the corporate tax code and changing it very dramatically and deciding to do that system, from what i read, retailers would end up paying a bigger tax on anything they import. it's going to drive their costs higher. is that worth discussing yet or too early in the tax -- >> i think it is way too early. we're watching it closely, listening, reading and looking. but from the perspective of the details, every input is a variable to make it hard for us to come up with a concrete answer to that. >> so what do you do with retailers at this point? which and i read the analysis of

the department stores, things are supposed to be better via the answers we talked about, and yet it doesn't feel like sales are moving enough to move the stocks hirer -- higher. >> the weather has cooperated thus far this season. i think snow on saturday was not a positive. saturday was expected to be one of the largest retailing days, especially for the bricks and mortar stores. but when you look at the extra two days, the consumers are in farly healthy condition. the balance sheets are improved. the unemployment rate is low and outlook of the new jobs and discussion of that. generally, we're pretty optimistic, but there are a lot of unknowns and variables we consider thinking about 2017. >> so what does that mean where i should put my money? in retail at all or pick and choose? what? >> i mean, amazon is still one of our favorite names when you talk about the shipping today being the largest shipping. you know, a year ago there was

costs inflated based on the three-put issue amazon had. they added 26 additional fulfillment centers this holiday season. so there is a lot of positives that have gone on. when we look at the retailers, that is probably still -- you the aws component, but from the retailing perspective, that should be a very -- >> this being the cloud computing system that people are excited about. is that the best name in the sector? >> the other name we are watching is tiffany. we have been watching a lot of the flagship traffic, speaking of the trump situation and we haven't seen a huge negative impact. and when we think about 2017, you know, we expect a new platform to be launched next year. they have some very easy comparisons that they are going up against. there's a new cfo at the helm there. that is another name. >> you are not worried about the

physical ability to get to the store next to trump tower. >> well, it is a concern, but maybe all the tourism is helping flow into that store, right? >> people want to see trump tower, i know. thanks. good to see you. happy holidays. coming up, can this market rally avoid a fourth straight january hangover? mike santolli will tell us what is going to change. and here's a quick look at the european markets. the industry known fort, g processing claims, into one focused on prevention with predictive analytics... helping them proactively protect the things that matter most. get ready. because we're helping leading companies lead with digital.

the past november stock rallies are followed by january pull-backs. but we'll see if this time is different. mike santoli is joining us. what specifically is -- that's your name, what specifically is the santa claus rally? when is it supposed to start? >> traditionally, it's the final week of the year. if you look at the stock traders almanac, that period of where it is bellweather, that is a test.

january is going to be a bit soft. >> if we're going to have a santa claus week this week. >> yes, we are discussing it being a santa claus rally. >> we were sort of in the middle of it. >> there's a rigid definition of it that is not yet started. >> oh, got it. because i saw it on another competing news service there there may not be a santa claus rally. i thought, there's already been one. >> the back half of december is where you get the seasonal strength as well. so all this stuff is in the mix. and i would be pointing out in a cnbc pro piece right now, basically the setup going into january is somewhat similar. if you look to last year, we were up 4% to 5% fourth quarter gdp. and if you look at the lead up to a weak january, down an average of 3.9% the last few years. last year led to a 15% correction. that's the one where you want to see if the conditions are at all similar. i would argue short-term investor sentiment has gotten frothy at the moment. that needs to get worked on one way or the other going sideways

or people are coming off a bit. however, there are distinctions with how the market looks right now versus last year n particular. i think the bond market is the big story. the credit markets were melting down last year with the fed tightening into a nasty credit correction. this year corporate correction looks firm. then when you got the fed hike last week, the longer term treasury yields lifted and you did not have a flattening of the yield curve. that's a good thing. everyone earnings are turning up positive. and the u.s. dollar is obviously strongest getting a lot of headlines, but on a 12-month basis, not up that much. the policy piece is a tremendous wild card. and i think it can probably cut both ways getting into january as we get into the inauguration. >> you're distinguishing between corporate and sovereign bonds, right? corporate bonds or sovereign bonds around the world are not. >> exactly. that's the dollar risk, right? partly, anyway, and you're right, the sovereign bonds are not -- that's what you want to

see. global developed market sovereigns go up. you don't want to see a panic in emerging market debt. but i do think it is corporate credit high yield and even investment corporate credit. it's really giving you this kind of green signal that says, look, even if we get a correction here, if we go down 3% to 5%, it's probably not the start of something all that significant. >> it's on cnbc pro, the whole thing, if you want to read it. >> it is, yeah. >> excellent. >> before you go, i want to comment on the tie. i like a good holiday tie. >> it's wintry, maybe. >> it's wintry. >> it is a plaid-type thing. >> not the santoli tie. when we come back, this is a really important segment. we are going to be joined by ale, andrea who has suffered

from tremors her entire life. alexandria will join us with the doctor who treated her coming up next on "squawk box." coming up, a money manager who made millions against sub-prime housing. he was made famous in the book "the big short." and was played by steve carell in the movie. >> everything that guy has touched -- >> now he's a new target in his sights. he'll be live on the set. that rare tv interview is coming up at the top of the hour. don't miss it. mary buys a little lamb. one of millions of orders on this company's servers. accessible by thousands of suppliers and employees globally. but with cyber threats on the rise, mary's data could be under attack. with the help of at&t, and security that senses and mitigates cyber threats, their critical data is safer than ever. giving them the agility to be open & secure.

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welcome back to "squawk box." here's more of the groundbreaking treatment, a friend of the show so many times.

we have dr. michael kaplan here from cornell medical. and we are thrilled to have you. when you told me about this, we talked about it and we're glad to have you both on the show. we didn't know about this, you never talked about it when you came on the show historically. >> it was something i was always incredibly embarrassed to talk about. anybody who has essential tremor feels the same way. it's odd, it's not life-threatening, but people just don't really understand what it's all about. and so you tend to want to hide it. >> >> we talked about it. >> you have this treatment and

tell us it affects five to ten times more people. >> this particular area that we target is in an area that is kind of like a relay station in the brain, so what we do is use ultrasound energy, and it's the same that you look at your baby with when somebody is pregnant, so it is safe for the brain, but this device made by this company uses 1,000 sources of ultrasound that are focussed on this spot, so each beam of ultrasound is safe and it uses energy to that precise target and takes out the abnormally functioning area, and

on the table with the patient awake resolves the tremors. >> that's what you used to do is drill a hole? >> yes, yes and we are trying to do less and less invasive surgery, and trying to not go into the brain itself. >> does this work if you have parkinson's or things like that? >> there's some testing going on for parkinson's, and many other disorders, alzheimer's and others, it could be used experimentally to change and improve function and that's where this might expand over time? >> ultrasound? >> ultrasound? >> how can you deliver medicine with an ultrasound?

>> it opens it up and the put it in the bloodstream and it goes right in. >> you now have -- this is still in the experimental stage? >> the tremor stage was approved by the fda a few months ago, and there are six and seven centers in the u.s. and we are the first in new york, but the other applications are experimental? >> i would be afraid -- it is apwhraeution? >> yes, and we build on the shoulders of the people that came before us. we were didding that with invasive surgery -- >> you don't need that part of it for other things? >> it can affect stability, and alex was a little unsteady in walking for a week or two after but the brain gets used to that.

>> on the left side, everything has been solved but on the right side, not yet? >> correct. basically they did one side of my brain and i chose my left because i am left-handed and as soon as i can and because it's so new certainly in the u.s., they don't do both sides at once, so as soon as i can i will do the other side. >> did you ablate the right to fix the left? >> correct. >> the experience is daunting because it starts with having your head completely shaved, so if you are a woman -- >> hence the short hair. >> and blond hair, i thought why not since i was trying it out. and they take a helmet and crew it into your head and that's a little daunting, and i got a little woozy, and your brain has

been mapped out, and i think there were seven of them and it feels like a little zap, and you feel like you are in "star wars" or something, and then each time they would take me out of the mri and i would have to draw a spiral and each time you could see the improvement and the final one, they said i think it's as good as it will get, and it was perfect. >> thank you, thank you for coming in. we appreciate what you are doing. >> what was the name of the company? >> insitech. the investor who bet above sub prime housing and that was in the "big short" coming up next.

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

new this morning, the eu digs in. apple is gearing up for a major court battle for a tax demand. a "squawk box" news maker. this hour a rare tv interview with steve eisman. >> you have no idea the kind of crap people are pulling and everybody is walking around like they are in a video, and they are all getting screwed, you know. >> he joins us in an exclusive interview. >> donald trump tweets and beijing responds. we will tell you what chinese

state media is saying today, as the second hour of "squawk box" starts right now. >> announcer: live from the beating heart of business, new york city. this is "squawk box." >> i am joe kernen. treasury yields have been a little quiet these last few sessions, the 10-year, and the oil prices under control, and we have seen 49 for a while and somewhere below 55, and we are at 52 today. >> the dollar a little quieter this morning. in the headlines, apple will launch a legal challenge to the european union's demand, and the tax deal with ireland amounted

to illegal state aid provided by ireland. ireland is also challenging that ruling. reports say vw is near a deal, and earlier they reached a deal that covered most but not all diesel vehicle owners. and then it's like a bartter, giving the government a 2% owner of bp. and china agreed to return a research drone that it snapped from international waters last week, and the pentagon said it engaged with china to secure the return, but president-elect trump said china should keep the

drone. today the tabloid in china -- >> i just want to make sure that china is happy with the way we are handling this stuff, and if they are upset -- if he is not presidential enough for them, what do you think we need to do, michelle? hopefully they are talking about this, and getting on the same page as the powers that be in china, right, an true? >> somehow i don't think that donald trump's intention. >> we're shaking. >> new in the last hour, the bank says a key investor and the privately funded plan is part of a deal. the stock is well off the lows

of the session but off the highs as well. and our next guest famously predicted the mortgage collapse in "the big short", and now we have that and a lot more to talk about. senior portfolio manager, and thank you for being here. before we get to what that is, which is a nice tease, how are you feeling about the markets right now? >> i am a little schizophrenic, it depends on what hat, the policy hat of where it should be, and then the hat for markets, and so in terms of policy hat, you know, i think dodd-frank is a good law and i wouldn't change it, and the cfbp is good apparatus, and the first

regulator i admired since volcker, so i wouldn't change anything, but it's not up to me. so what i think is going to happen is i think the financial system is going to be partially deregulated, and i think over the next couple of years there will be leverage and it will be a golden age of investing in financial stocks. >> you would be very long in financial stocks? >> as long as i could be. >> is that what you are? >> that's what i am. >> across the board or in smaller banks or bigger banks? how do you differentiate? >> you could bar bell it. the two sectors that benefit the most are the banks generally and the life insurance companies. >> you think dodd-frank is going to be somehow part of it? >> i think that's too hard -- that's the wrong thing to focus on. i think it's hard to say whether

todd frank will be changing or not. >> there will be regulations -- >> you think it's going to be as long -- why would something that you don't want to be rolled back if it's rolled back a little why would it be so positive for the financials? >> there's financial system and financial stocks, and the two are not the same thing. >> are you setting up a big short down the road from this? >> we are not going back anywhere. simple tums. today it's levered 10 to 1. and my expectation is it could go to 13 to 1. >> if you like todd fran skpbg you expect it to be rolled back a little, and i don't understand why you like it so much if it has been holding back the stocks? >> like i said, there's a financial system and financial

stocks. >> how much of a function do you think it will happen in washington versus what will happen with that interest rates and what happens with the banking system? >> i think the regulatory app r apparatus will be rolled back. >> so i see the immediate impact that you are talking about, and is that something you worry about long term or no? >> depends on how much it's rolled back. citigroup being levered 35-1 is not going to happen, and if it goes 13-1, certainly. would i be nervous about that? i don't think it's a calamity, and it's not something i would prefer as a policy perspective but it will help citigroup's stock price. >> was it a mistake, then, to pursue dodd-frank and so many of the other pieces of regulations over the last couple of years the way we have given what you

think is happening or what has happened to the financial markets or the economy, to the extent that some would argue, right, that this is kept capital out of the system to invest in building things? >> the argument people have made that dodd-frank has somehow negatively impacted the economy negatively because it presented banks from making loans sounds great, but there's only one problem with the thesis. it's not true. it's just not true at all. >> that's what steve minutia told us that morning here. >> the only areas that have been impacted is the mortgages, and that's not a todd fra-- dodd-fr, but it's a bank issue. and the small businesses being impacted by dodd-frank, that's

not true. banks are not venture capitalist. when you ask for a loan when you are a small business borrower, the first question banks have is what is your collateral, and people would -- small business lending was largely disguised home equity lending and now with home equity lending going away in the post crisis era, that's where the small business lending is smaller. >> it's often coinciding with the idea of reducing regulation a lot and require them to have more capital therefore you don't have to worry so much about -- >> in the post regulatory world, to require the banks more

capital is silly. they are well capitalized now to slightly over capitalized, and the new administration to require banks to become more capitalized is rhetoric. >> what about those that will be administering, if you will, economic policy. do you know steve -- >> never met him. >> gary cohen? >> i met gary komen a couple times for a few minutes. >> where do you stand on the type of people you want in the place? i think you talked about wanting more outsiders around the table and do you look at it and say this is a revolving door? >> i don't want to get into the new appointees. they are appointed and hopefully they will do a good job. i don't want to comment on it. >> what wouldn't you invest in right now? >> what would i not invest?

>> i would ask what is the big short? >> i don't have a big short. the environment for the last several years, slow growth, low rates and a constant fear the economy will rollover into a recession, and people like tech and stables for growth, and i think the next couple of years will be a reversal of that story? >> were you expecting the reaction to the trump win? >> i had not thought about it because i was not expecting it. the morning after the election i new financial stocks were going up. >> did you buy that day? >> i did. >> you have bought more since then? >> i have. >> would you belong the market, and i think many people have missed the 10% move thus far and are thinking to themselves, have

i missed it? should i be getting in now? what is about to happen? >> i am very long. i think trump will get most of his agenda passed. people are skeptical about that but i am not because there's a big difference between republicans and democrats, and republicans view politics as the art of war, and democrats view it as the art of compromise, and i think you will see that -- >> these are like facts -- you say they are like facts, and they are your facts. >> i only have my facts. >> yeah, i know. >> but, look, at this point during the obama administration the republicans got together and said they are not going to help at all and they stuck to that. >> let's stick to the markets. >> we want to thank you, steve.

>> wait, wait, wait. did you like the way they depicted you in the movie? >> i did. >> are you that much of a bad-ass like that? >> a lot of therapy later i am not. >> you are nice? >> nicer. >> are you managing other people's money and loading up your clients in financials as well? >> yes, we are. >> it's great to see you and appreciate it and it's a great movie. >> i loved it. >> you have hung out with steve carell at all? >> i have not seen him since the premiere. >> fair enough. thank you, and good to see you. let us know when you have the next big short or big long. >> stocking stuffers of market strategist everywhere, the year-end targets, and find out who is closest and who has eggnog on their face. and walter isaacson will join us with his latest project. it's all about jobs,

infrastructure and america's long-term prosperity. 8:30 a.m., fixing the tax code, and grover nor kweus will be with us. they are the natural borns enemy of the way things are. yes, ideas are scary, and messy

and fragile. but under the proper care, they become something beautiful.

welcome back to "squawk

box." the dow opening higher by 32 points and the s&p by nearly 5, and the nasdaq by more than 4. the dollar is backing off a little today. >> joe knows everything. making headlines -- i was not joking. the ft announced the $65 million merger by wednesday. the industrial gas companies are said to be finalizing terms. in other deal news this morning, british tobacco plans to add a cash sweetener for reynolds american, and reynolds american now demanded british american tobacco change the mixture of cash and shares it offered and that's attempting to buy 58% of reynolds it does not already own.

and it's a $4.9 billion deal in cash and stock, and fairfax will pay to allied owners and the offer worth an 18% premium to friday's closing price. is 'tis the season, and santa is not the only one checking lists twice. and don joins us with a list of his own. this has wall street strategist and their year-end targets. i put a lot of faith in this. this year or next year? >> this is next year. i guess you are close to nailing it if you just resized it for this wraer, and let's give these guys credit to start because they are putting out their forecast and we will see what they think for the rest of 2017. we pulled 13 wall street strategist with regard to what

their s&p targets are for the year end and here's the sampling and summary. if you take a look at the median forecast we are not expecting a whole heck of a lot in stock performance this year, and that's the median forecast among the strategist that we pull. if you take a look at the upside, that implies about 3%. we are not expecting a whole bunch going on, and there may be volatility. the low end of the estimates come in for a credit squeeze, 2200. this is a mid year forecast so they do it differently, and they update throughout the course of the year, and right now the low end of the forecast, and the high end is barkleys, 2400 and the spread is not that wide, and so if you take a look at the overall chart, though, the way things shape up along the way it will seem a little different because we do see not that much volatility at least with regard to these particular projections,

but andrew if you take a look at the way things are shaping up and with no surprise the way it's running in the two or three months, they are not expecting a whole bunch in terms of stock performance next year. >> thank you. >> you got it. and box office winners, and i bet you know who it is. we have stock in the telecom and utility center. you are watching "squawk box" right here on cnbc. but you can't. (cheering) at cognizant, we're helping today's leading media companies create more immersive ways to experience entertainment with new digital systems and technologies. get ready. because we're helping leading companies

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the competition is fierce. >> that prize is mine. >> the stakes are high. >> the $100,000. ♪ ♪ >> welcome back to "squawk box" right here on cnbc. in media news, teased this before. what was going to be the biggest movie of the weekend do you think? >> of course the "star wars" movie. >> the force is still strong. the latest "star wars" movie topping the competition, and took in $155 million in the u.s. and canada, and it's the second

largest opening in december, and topped only by last year's star wars:the force awakens." the movie has made $290 million in total thus far, and "rogue one" is a spin off from the original 1977 "star wars" film. we do expect a number of other "star wars" -- a "star wars" story kind of movie in the future. one a year. >> that would explain why they made $100 million compared to last year, because there is so much penned up demand. >> it reminded me of the animation of "despicable me." it was illumination or whatever

it was called. >> it's coming. >> wednesday. i am just wondering -- >> next weekend is going to be -- >> right, and i think there are high hopes for this, and it looks pretty good, i think. we will see. >> cool. >> animation, you can't count on anything anymore except for animation it seems, but "star wars" you can count on, but if you are trying to do a new idea and a drama with actual people, it's tough and animation it seems like you can count on it. >> there have been some, and there are some struggles -- >> didn't "minions" do well too? >> you have to tell a good story whether it's animation or real people. >> even pixar has movies -- >> i am not sure animation is

just into itself. >> if i was going to invest money it would be animation. >> and elliott had a unique touchdown celebration after scoring, and the running back jumped into the giant's salvation army kettle behind the end zone. the celebration has the internet buzzing, and the salvation army tweeting zeke made a contributable donation, and you have to -- >> we are not going to read that open? >> was it there? >> yeah. zsa zsa gabor was 99. >> we will talk about it at the commercial. >> yeah, they were hard to tell

apart. >> i thought he was the one in "green acres," but she's not. it was ava. >> as we head to break, take a look at u.s. equity features, which are positive. stay tuned. you are watching "squawk box." what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter.

morgan stanley

♪ ♪ welcome back to "squawk box." among the stories front and center, a notable winning streak came to an end last night, and the nikkei dropped the first time in ten sessions, and it had gained 6.2% remains near the 2016 high. electors in the 50 states will meet, and the results won't officially be announced until january. and super mario is as super

on smart phones following the debut of the super mario game, and it's the number one download in apple's app store with nearly 5 million worldwide. mosaic struck a multi-billion deal. and vale can earn extra money in the two years following the completion of the deal. the national average for a gal of regular gas jumped 6 cents over the past two weeks to $2.26 a gallon. that's according to the lundburg survey. the average diesel price is four cents higher, and i went to a place and paid cash, and it was the same as a credit card. >> it's supposed to be cheaper. >> i looked, and it was $2.59,

$2.59, and i almost said take the credit card just to make them use it. zipcar? >> no. >> does the zipcar come filled up? >> i have not done zipcar in a while, though? >> what you have been doing? >> uber, taxi, subways, trains, planes. >> i want to read the zsa zsa open. >> this is big for you. >> yes. >> tributes powering in on social media to celebrate zsa zsa gabor, and she passed away yesterday at the age of 99. larry king saying there will only be one zsa zsa gabor, and i liked her a lot. rest in peace, zsa zsa gabor. nine husbands, and hollywood star, what a life. and she and her sisters were lovely ladies who were always fun and delightful to be around.

we have other sad news to report. do you know about this? >> yes. >> and this is sad. dr. harry heimlich died at the age of 96. the technique has been credited for saving 100,000 lives, and choking on food or foreign objects was the sixth leading cause of accidental deaths in the united states. >> he performed it on somebody and saved a life not that long ago. you know where he is from? i guess you have to be from there. cincinnati. >> yeah, a cincinnati native. so what i think saban. >> yeah. >> a lot of famous people from cincinnati. >> yeah, it's a great town. >> it's a good town. it's okay. we all have our home towns,

right? >> switching gears back to investing. telecom and utilities today, and here to break down the favorite picks, our guests. good to have you here. first of all, do you think those sectors are working right now, and are you worried about rising interest rates? >> if we are looking at utilities, and i like charter communications and it's not exactly a utility, but it's similar, and it's a little late to the party but you have a lot of things working, margin improvement, and restructuring, and buying back stock, and it's in a sector where the fundamentals are moving in the right direction. >> you also like aig, correct? >> absolutely. so aig has so many things going for it, because we know that it's an insurance company and it has great fundamentals in terms

of the pnc business which is getting better over time, and sorry, charter communications was what we talked about, and charter in particular because it does not create a lot of content and charter is a business of distributi distribution, and charter has the advantage of buying product cheap when there's a lot of available product. and late to the party but a great benefit of interest rates going higher which we would like to see and we know are happening over the next year or two, and nobody has paid attention to aig, but we like it here. >> david burke, you are looking at some of the electric utilities and ketelecom. what do you like in those sectors? >> we think they look moderately expensive on the valuation, and historically they traded at about 14.5 to 15, and not any compelling values at this point.

we still like next year energy, and this is the biggest utility in the state of florida and the largest generator of renewable energy, and expect dividend drove, and a good core holding. >> what about in telecom? >> yeah, we still like at&t, and it trades at a modest valuation at 14 times earnings and 4.7% yield dividend has been raised 33 consecutive years, and the total return is in excess of 25% which is a gain for a company of modes modest-sized growth. >> the regulatory picture for the next year you think adds to that? >> right. we think -- funny you mention that, because since the election the telecoms have been one of the stronger performing groups. as of november they were up only

3% to date and now up 15% compared to an 11% gain for the s&p 500 and a 10% gain for the electrics, and we think a more pro-business investment could help the telecoms. >> you think it's priced in? >> yeah, and keep in mind, the increased data usage this is a mature industry and 90% of the u.s. has cell phones and almost 70% have smart phones so it's a mature industry. >> then i see one more, and karen, hsc, smoke stack industrial company? >> fantastic. yes, we like the company for infrastructure rebuilding, and all of those are positioned to have some growth over the next several years. we are seeing industrial production beginning to pick up

commodity prices are improving, and harsco will benefit, and it's a multiyear platform, and they can see growth 6.5 times, and it's only a billion in market cap so we see that as a potential acquisition candidate. >> it has gone up 78% over the last year. it can get more? >> oh, absolutely. if you look at the long-term chart, it peaked in 2007, and it was down 75% since 2007 a phufrpmonth ago, so still a long way to go. >> thank you for joining us this morning. >> thank you. cupping oming up, the highl with our interview with steve

eisman. later, fixing the nation's tax code, grover norquist will be our special guest. stay tuned. you are watching "squawk box" on cnbc.

♪ ♪ welcome back to "squawk box." the futures right now suggest a positive open. the dow would open higher by 76 points and the nasdaq opening higher by a little more than six. and the euro is still at 1.04, and 117 yen for every dollar, and the british pound will cost you $1.24 this morning. and we talked to steve eisman earlier this morning. he has a new call on financial ppz >> what i think will happen is the financial system is going to be at least partially deregulated, and over the next

couple of years there will be more leverage and this will be a golden age of investing in financial stocks. >> you would be very long right now in financial stocks? >> as long as i could be. >> is that where you are? >> that's what i am. >> take a look real quick at the big banks here. you are looking at green arrows across the board right now but boy have the stocks been on a run and tear in the past month or so, and the s&p financials we should say in total up 17% since the election. >> and he was very emphatic they could go even more. >> america's millionaires much more bullish. is that true, andrew -- >> am i bullish. >> you always say i am the sun census part of the sheep, so i

am bullish. >> we will add two more millionaires to the bullish. the numbers were evenly submit in the terms of the votes, and nearly two-thirds now say donald trump will be good for their investments, and 43% of millionaires polled voted for clinton and 42% for trump and that was a huge swing and the spring survey, and trump captured all the undecided millionaire voters, and trump and clinton got equal votes from those making $250,000 or more. and only 30% in the spring said the economy would be stronger. 62% said he will be good for their investments and half say

their personal assets will also increase next year. one big reason tporp, lower taxes, and those worth $5 million or more, 40% expect a tax, and they say they will put that into stocks and the deficit may also increase next year and the most important issue for trump to address is health care followed by foreign policy and taxes and government spending. that's a big change. normally taxes and government spending is their big issue. and the forecast for the economy still driven largely by the politics. 92% of republican millionaires say trump will be good for investing, and only 18% of democrats agreed. >> does that include your house? >> a million dollars in investable assets. and what is shocking wealth level used to be the predictor

of a lot of things, and now it's irrelevant. politics drives your view of everything, the markets and the economy, and it's just -- over the past ten years, it's just shocking to me to see how the whole prism of politics shapes how the wealthy view, everything, including markets. >> we probably need a new word for millionaire. >> you can compart men tau lies. >> yeah, $10 million is the new million. when i was growing up, a million dollars, and then robert redford gave $1 million to demi moore -- >> yeah, for one night of work. >> and they are a relevant group for who is investing and who is owning stocks. >> even with pension plans? >> 90% of the individually held

stocks. >> not the stock market overall. >> they are one of the most investor group -- >> millionaire doesn't mean rich anymore. >> and not in new york city. >> not at all. still doing well, though. >> yeah, and anybody that owns property in new york is probably pretty close. wouldn't you think? >> yeah. >> and not even if you live here and have own a home, you probably -- >> investable as sets. >> yeah, and even to be -- >> there was a story about san francisco homeowners, they own a $6 million home and they felt poor. >> income and wealth is different. >> thank you. coming up, this morning's stocks to watch, including home builder lamar. and check out oil prices this morning, higher by 98 cents -- that's lamar, and wti higher by 7 cents.

and national gas is at $2.36. stay tuned. you are watching "squawk box" here on cnbc. with it, i earn unlimited 2% cash back on all of my purchasing. and that unlimited 2% cash back from spark means thousands of dollars each year going back into my business... which adds fuel to my bottom line. what's in your wallet?

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tadirectv now. stream all your entertainment! anywhere! anytime! can we lose the 'all'. there's no cbs and we don't have a ton of sports. anywhere, any... let's lose the 'anywhere, anytime' too. you can't download on-the-go, there's no dvr, yada yada yada. stream some stuff! somewhere! sometimes! you totally nailed that buddy. simple. don't let directv now limit your entertainment. only xfinity gives you more to stream to any screen. ♪ ♪ >> let's check on the markets this morning. we will look at the futures and see they were up 40, and now up

37. and the nasdaq indicated up just under seven. from europe, it was mixed all morning and it's fractional gains and losses, and it just turned positive but barely. asia was down earlier. check it out right now. nothing huge. hang sang down almost a percentage point. and wti, the 10-year was below 260, and the dollar, not a whole lot of action, 1.04 on the euro, and 1.24 on the pound, and gold is still up but changing hands in the low 11s, 1140, and 1141, and that has gone in the reverse direction of most financial markets because, i guess, really it might have more to do with the fed and with interest rates

going up and the strong dollar than with anything else. we have another story to tell you about. a criminal story this time. and prosecutors have charged fraud totaling 1 billion on platinum partners. and the u.s. attorney will hold a news conference later this morning to give further details on what took place. >> what do we know about it? any dealings with it? >> no. >> it has been in the paper for a while for other issues. >> platinum partners? >> yeah, had some issues in texas. >> we don't know any facts. we are talking about a billion, huh? >> a billion. >> american greed coming up. >> at minimum. let's look at stocks to

watch. lennar beats estimates. earnings $1.34 a share, and they sold more homes at higher prices trau sraug yo, and they closed the day at 1185. you like him, the trivago guy? >> i like the actor. i thought he was a nice guy. i find it all so weird. >> it is weird. >> and spooky. >> he's famous. he's like flo, the insurance lady. you know her, right? >> yeah. >> i like her. >> i do like her. >> i don't like him. >> she's charming. >> i like flo. >> they ties on the show, so i like -- >> they do? i like them. >> you know who else should

ties, samsung. they plan to use rival batteries in their smart phones next year, and blackberry plans to open a autonomous driver center in canada today. they want in the race to develop self-driving technology. q & kpfplt. global stock news this morning, we are watching shares of italian deep -- oh, do the pronunciation. >> paschi,

>> they are trying to revolsolv the issue. >> it's needs to get revolved at some point. and then goldman sachs to settle. comes after seven other banks agreed in pay to pay $324 million to resolve the case. they rigged the fixed rate which is used to price credit swaps and structured debt securities. >> iran and airbus have finalized their 100 jet deal and it's expected to be signed in the coming days and the first part of the order should be delivered in january, and it could be before the inauguration of president trump, and he

expressed opposition to the nuclear deal. iran finallized a similar deal with boeing just last week. toronto-based fairfax financial to buy allied world insurance, and 4$4.9 billion in stock and cash. in other corporate news this morning, danone cutting its growth target below the previous forecast, and the company is sighting weakness in the spanish market and problems rolling out new branning for the activia yogurt in europe. and then a deal for bp with abu dhabi after years of negotiation. as part of the deal, bp will

create new stock worth 2% of the market value and will be held by the abu dhabi government. gearing up for a major court battle, and the latest on the fight straight ahead. stay tuned. you are watching "squawk box" on cnbc.

what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom? what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley

20,000 futures indicating a higher open as we head into the last trading week before the holidays. >> a tax battle roy al. face-off to the potential changes over the tax code under president trump. and then the second best december opening ever, and we will tell you how much it broad in worldwide. the third hour of "squawk box" starts right now. ♪ ♪ >> announcer: live from the most powerful city in the world, new york. this is "squawk box." >> welcome back to "squawk box" here on cnbc. we're less than 90 minutes away from the opening bell on wall street, and futures have been up for most of the morning, and 32

up on the dow indicated, and nasdaq indicated just over 5. and there are some green and some red but small numbers across the board, and the dollar has been stable for the most part. $1.04 on the euro, and 1.17 with the yen. let's get you caught up on some of the headlines investors are talking about this morning. apple intending to lodge an appeal on the european union's tax bill, and we knew it was coming but the timing we did not. it was singled out because of what they called its success. and ireland accusing the european commission of overstepping bounds and interpreting irish law.

"wall street journal" is reporting the carmaker could spend an additional $1 billion to settle claims that were not covered under a previous $10 billion in the emissions cheating scandal. and president-elect trump has chose his white house budget director, and it requires senate confirmation, and he is known as a fiscal hawk. and bp is scheduled to buy stake. it makes the abu dhabi government a 2% owner of bp. november, durable goods and the final estimates of the quarter

gdp. news that we told you about last hour just breaking in the last few minutes, us prosecutors have charged the cia and six others of platinum partners with fraud, and david levy and the former head from the signature fund. there will be a news conference giving further details on the whole story. last hour we interviewed eisman, and he has a new financial call on financials. >> here's a little dirty secret on lending, and banks are not venture capitalist, so when you ask for a small loan when you

are a small business borrower, and they ask what is your collateral, and precrisis, people said, my house. it was disguised home equity lending, and now with home equity going away in the post crisis era, that would go away. >> his call was to go long financials and he defended dodd-frank and argued that it was not stifling lending on small businesses. >> it was interesting, because he said i don't think that dodd-frank should be rolled back but i think it will so i am very long with financial psfinancial. that was my favorite. >> i wish they wouldn't do it, though. >> one thing, what you want to happen from a market economy

perspective, and another thing of what you think is the right thing for society and also i think you can have both positions and still be in the same place, no? >> exactly. maybe. you know, i would -- i think usually it's a good idea if we, you know, if our financials are doing well, right? i would say that, you know, could be positive. >> we have had traders on the show, and -- >> there are also people that think it would be better if the financials didn't do really well and only made a certain amount of money like a utility. and i think that's an insight into maybe his -- given some of his other comments, i don't think he's the most necessarily -- >> we all want to avoid bubbles at the same time. >> if you are looking down the road and think things can get overheated, that's one thing,

but if you have turnover like previously. >> he seemed to have no fear of a crisis coming. >> that was the most interesting piece of it, because he said he was talking about citi, and he said maybe it goes up to 13 or 14, but not getting to 30 which is where things were at crisis levels. to the broader markets, and joining us now is mark lehman, and doug coaty, a chief market strategist. good to have you here. i want to talk about financials in a second but looks like you are both pretty bullish, right, because of the changes because of trump's election? >> i am bullish, and we have seen a big assent since the election, and it will continue through the inauguration. you have some people who are on the sidelines, a little disbelief of the rally, and then you have influence -- capital influence to mutual funds which

we have not talked about, and then an under exposures to equities and i think you will see a strong '17, and it will be more fervent than this year, and we are setting up for a nice start to 2017. >> doug, do you want to add more to that? >> i am bullish because we are on a new path, and fed chair yellen acknowledged that last week and it's about tax cuts, not just for corporations but for small businesses. you talked about financing small businesses before, and tax cuts will help that a lot. what we are seeing is, we are already seeing an acceleration in corporate profits, and the consumer continues to do well, and developed economies around the world are doing well, and add to this, some pro growth economic policies, and you have the reflation trade. >> what are the risks, doug? >> well, the dollar. the dollar is probably the

biggest one, and if the dollar gets out of control -- >> i think fed chair yellen is going to be watching that and i think it's not -- it needs to establish eyes. i think it stabilizes here. janet yellen has been doing great job, and everybody is talking about the fiscal side, and i like the selection of mull veiny. if you don't do spending cuts f. you don't get the budget under control, then these tax cuts are for not. it won't be credible. >> it will be like under george w. bush that launched the whole tea party movement. >> you can't just do one side. i don't think the tax cuts get through unless you have a credible plan for spending cuts. >> mark, would you buy the banks here after the big run? >> i think they are going to have a great '17. you are going to see more capital flow into them and you will show a lot of foreign investors coming to their banks

and the wind is at their banks, and i think you are going to see more people exposed to that sector. >> facebook, that's like your top pick. why? >> you know, the growing earnings as fast as anybody in the tech land and their continued exposure on instagram is a second leg to their stool, and as i said before on this show, you know, they get a world cup final every day, and a billion people check their facebook every day, and i think that's going to continue to ascend. and in january they are going to earn over $4 this year, and when they are growing that rapidly you want to own that stock. >> doug, the financials. i am getting nervous about the financials because everybody likes the financials, doug? >> i think it's more important to talk about the whole portfolio. everybody is way too defensive. i think you need to broadly diversify your portfolio across

global stocks and global fixed income, and getting back to a normal allocation through mid caps and small caps, and i don't think it's just going to be s&p 500 any more, and it's going to go down the spectrum and we are seeing that across the markets, and the senior loans would be good in the fixed income side so look at the whole portfolio. >> gentlemen, thanks for being with us. >> thank you. when we return, a tax battle royal. norquist and jared bernstein going head to head under a donald trump administration, and first walter isaacson is going to join us and tell us what it's all about right after the commercial break. ..no. at cognizant, we're helping today's leading manufacturers

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♪ we got a little white christmas over the weekend, but not there yet. >> i got six inches of snow in the country. >> outside the city. >> my kids loved it. >> it got very wet very quickly,

and a little icy, too. >> it's scary with our dogs. the mud -- when it got wet, yeah. >> and your dogs are big. >> they are big. they like to play. they came in yesterday and they still have not emerged from when they had to be sequesters. >> they needed a shower or bath. >> so do i. >> we all do. and the jobs growth and securing the u.s.'s long term prosperity by fixing what is a broken system. walter isaacson, a cnbc contributor and friend of show. >> we are in new orleans where we don't have the problem of a lot of snow. >> but you have good food. i will tell you that. >> i think this is a good time, because both earlier in the show and later in the show you will be talking about what to do when

you repatriations the money, and it's extremely important now in america to have any investments you make be long term as well as for short term gains. in other words, the research and development where america used to lead the world, we are now tenth in the world. the notion of insta structure where you are investing 30 years for life, we are now 25th in the world. in world war ii, it was a great long-term investment by corporations, and the tax code rewarded long-term investments, and wall street rewarded long-term investments and the government with highway systems and the internet made its own long-term investments, and we have not had that in the last decade and a half, and this new

attitude would help to have a return on investment. >> how do you want that infrastructure spending structured? what context? >> well, first of all i think you give incentives so companies and corporations, whatever they may be, to do basic rnd, and they would have the microchip and the processor, and you have to have the tax policies that allow that and the atmosphere so that investors aren't just holding stocks for the short term, and they have some incentive to invest for long-term profits. when it comes to government spending, the government spending should be done in a way that clearly produces a return on investment and hopefully is done hand and glove with public private partnerships, and maybe run by a czar, somebody that

knows business, and says like a michael bloomberg, just say, mayor bloomberg you are in charge of some of the intpau structure investment -- >> could you see the donald trump administration hiring mr. bloomberg? i think bloomberg would be the right person to do it. if i am supposed to be guessing at who donald trump might hire, i am not the person to be doing that because sometimes he surprised me, sometimes for the good and sometimes i don't get the trust, and bloomberg could have an infrastructure bank, and that bank could make investments based on sound choices. you could have many people run. you could have jeff hemmelt run something like that, and i think, jeff, if you had a credible person who knew how to

make investments taking -- >> walter? >> yeah. >> it's michelle. good to see you. he was at a china event last week, and hanging out with pilots from united. i always revert to jfk and airports in general, which is -- a lot of us fly every day and we pay a fee every day that we fly, right? there's a user fee. you might think that user fee is supposed to be for the airport since you are paying that to fly out of the airport and it's not and it goes into a big pot and congress mushed it up, and i think it would be better to remove as much of the federal government as possible and get the users of whatever infrastructure that we are going to need or improve to be the people actually paying for it because right now we pay for stuff that we don't ever

actually get. >> yeah, absolutely. that would do two things. it would make sure the money went to the right place and it would reassure the person paying the money they are not doing what you say happens to you, you pay the money and don't get any services for it. i think take something like airports, and it's even more complex but important is next generation air traffic control. that clearly saves huge amounts of money, and it allows more planes more safely to fly to more places and it saves everybody time because of the fewer delays on planes. you have to have some government ininvolvement because you can't have random airports doing each their own traffic control, and you could have dedicated fees for the air traffic control and have it supplemented by the fees, and you have to have somebody to do it right and have priorities and not just spread

it around as if it's a congressional plumb program. >> and i am looking at this, and marty lipton is involved, and you have a whole group of people, and how hard was it to get everybody to sign on? i imagine not everybody agrees on the particulars? >> right, they don't agree on the particulars. it was easy to get people to sign onboard, and we didn't want to go after people who are ideological or the government type but people who were actually running real companies that would benefit from long-term thinking in this country. we got -- go ahead. >> i would say in practice, now, what are you doing with the proposal? >> i think we are going to flush it out. somebody like marty soral, he has been a driving source in

this, and so has marty lipton, and holloway and others, and i think we are going to get it more and more specific. the goal is to make sure not everybody agrees with everything but they can sign on to the packet. this is something that is not done in washington too much these days, which is to say i don't agree with all of this but together with the package with the compromises it makes it's better than not doing anything and just having a short-term investment strategy? >> and then what, meaning do you take it to the white house or washington? what is the ultimate goal to put this into practice? >> i think it requires a lot of things. it requires changeings in the tax code so people are rewarded more for doing long-term investments and simplification of the tax code, too. it would also require the infrastructure plan that trump i think is already trying to build and hopefully have somebody, as i said, whether it's a michael

bloomberg doing an infrastructure plan and understands how to make sure it's in long-term investments that will have a payoff. i think we will be pushing for the general principles. this is something that has been very bipartisan, although mainly driven by corporate and business interest that can be controversial, and sometimes people think corporations are just -- this is a way to level of playing field so anybody in business could think long-term and do more research and investment. >> always good to see you, and wish you a very happy holidays, and i am jealous you are in new orleans this morning. >> go have jambalaya. >> i am not sure i can do the been yeas. >> absolutely. great to see you. coming up, a big win at the box office for the latest "star wars" movie. we will tell you how much "rogue one" brought in. "squawk box" will be right back.

box." the force is still strong at the box office. disney's "star wars" still topping the box office. "rogue one" is was the second largest opening in december, and

"rogue one" is a stand alone spin off following a band of fighters that play a key role leading up to the events in the '77 "star wars." we referenced this in the 6:00 hour, and now we have viral news to tell you about. ceelo green with a cell phone exploiting in his hand, and he is holding the phone to his ear, and the device explodes, and he went to social media to say he was alive. a lot of viral tweets going on it was a samsung galaxy 7.

>> it's a hoax. >> that's like character assassination of the phone. >> did you see that? >> it looked like you could have been really, really hurt. dead even. >> yeah. >> it's not funny. >> that's going to back fire. i don't know, though. >> he never says what the phone is, right? >> he doesn't. but that is what was making the rounds. >> right. coming up, tax reformers, grover norquist and jared bernstein talking the tax code under president-elect trump.

welcome back to "squawk box." let's take a look at stocks to watch this morning. walt disney was added to the u.s. 1 focus list. the stock is now positioned for out performance on an upbeat out look from the parks and resorts as well as movie studios. we told you earlier "rogue one" brought in a ton of money over the weekend. and reynolds american deal may increase the cash portion of the

$47 billion takeover deal to buy reynolds, and costco to buy from citi. that's due in part to the lessoning of deflation in food and gasoline prices. checking the broader markets this morning, and right now it's suggested we will have a positive open to the u.s. markets. the s&p up by 4, and the dollars has come down a little bit this morning. last we checked, mixed against the major currency, and stronger against the euro, and weaker against the yen, and stronger against the british pound. 1.23, and earlier it was $1.24. and wti has a decline of 17 cents. that's the february contract, so that has rolled over, and the natural gas, still january, lower by two cents this morning.

with republicans assuming control of the house and the senate in january, tax reform will be at the top of the agenda. for more on what we can expect, let's bring in grover norquist, and jared bernstein, and jared, you have been to trump tower? has anybody reached out to you? there has been some movement across the aisle from time the time? >> amazingly, i have not yet been up to trump tower. >> sarcasm. i was going to give you the benefit of the debt and stpaurt by saying are you working on the russian thing or the recounts or are you starting to realize you may need to address policy -- >> i was there weeks ago, and in fact, if you read my stuff, which i recommend to you, i have been thinking about ways in which perhaps there are some

ways we might work together, and tax reform is one of them. lowering the trade deficit. >> you are stuffing crayon in with it. grover, you say what you would like to have happen and what might actually happen with whatever puts this together, paul ryan or donald trump or however it works and then i want to hear jared say whether he likes it or whether he would change things or -- >> i would change a few things, sure. >> you have not heard it yet. >> my bad. >> both the trump campaign and the republicans in the house are very close on their two packages. we will take the corporate rate from 35% to either 15 or 20, and i like 15 better, but somewhere between 15 and 20. we will go to full territoriality, so while they

may deem repatriation for some of the money overseas taxed now, it would never be taxed again and it will be a normal country that taxes things within its borders and doesn't tax income overseas, and full expensing, which is important to drop the cost of capital, and i hope like-kind exchanges will continue, 1031, and that's being debated and until you get rid of the capital gains tax you can get 1031 that doesn't punish you when you go up, but when you cash out. >> no way you can have any problem with that? >> no, end of segment, i'm good with all that. no, my usual role in the debate is to say we don't need a big tax cut and we are going to need more revenue in the future whether we are talking about the

infrastructure investments that we just heard from our friend from aspen or the aging demographics but in fact a tax cut is coming, and we need to think about how we get the biggest bang for the buck. some of what grover was just saying is going to happen, but there are details that make a difference. for example, i would like any change to be at least revenue neutral, and i would argue for revenue positive and republicans are nowhere near there. and grover talked about expensing, and i like this idea is to eliminate interest deductibility, and you can't do that unless you are creating a big tax loophole. i also kind of like this destination based border adjustment idea for the corporate code, but i would love to hear grover would say he would endorse the idea of that -- >> there's a discussion about

where you make it voluntary and make expensing or get rid of the deductibility. i think it's an important first step. i did leave out what was going to happen. we will be getting rid of the death tax finally, and it was put in since the civil war and that's over, and we will get rid of the alternative minimum tax which was supposed to hit 155 million people living in new york and it is expanded to millions. >> and jared brought up the whole destination-based taxation. the retailers have gotten hit recently because of this, if you dig down into the gop house plan, they don't want to lower the corporate tax rate, they want to dramatically change the way corporations are taxed, and they are not going to be taxed on the profits, and there's going to be an added value tax process that once they export they can get all that money

back, and it's a zero tax rate basically if you are going to eubgs port something, but it seems to be bad for the retailers because they have to bring taxes in on everything they bring in, and am i explaining it correctly and is that a good idea? >> it's not a vat, because that's a labor cost as well. >> this is just from cash flow and excluding labor, right. >> i'm always concerned that that could turn into a protectionist, but if our goal is to take the corporate rate down from 20 to 15, and eventually down to 10, and i hope to zero because it's a silly hidden tax, and if you get it down low enough the border adjustable thing is less of a problem, so -- >> but it's a problem for something like a retailer, right? >> it is. let me just say, michelle, you explained that very well, i think. it's a -- basically a tax on

imports and subsidy on exports. if you go to the destination-based border adjustment tax you take the location system out -- >> yeah, you eliminate that problem. >> i just want to say, grover and i strongly disagree on this business of eliminating the estate tax and it's called the death tax. this applies to 0.2% of estates. the exemption right now is over $10 million for a couple. >> why have it at all? >> because it raises some significant revenue, and if we don't have it, there's a bunch of income that goes untaxed. it's the pure gift of the wealthiest of the wealthy. it's not a smart idea. >> okay. democrats operate on trickle down taxation. they tell you they are going to tax rich people and then they screw you and they do it with

the death tax and it's only rich people and hillary clinton was running on the idea she was going to move more and more people into paying the death tax with the exemption was not going to continue and take the rate up, and as long as it's there, it's like crabgrass. >> for you it's more philosophical than it is about anything else. >> correct. it's just wrong -- >> it is a gift to the very wealthy, right? >> no, when i walk down the street and a mugger passes on the other side of the street and he doesn't take my wallet, he didn't give me my wall wrewalle. this idea that when the government fails to steal your money in taxes that it gave it to you is nonsense. it's not a gift. >> both of you, i have a policy question for both of you that relates to this, but many of our viewers, so many of our viewers and elsewhere, some of the very

wealthy in america have set up trusts and other types of things to protect their income for generation skipping and other things. >> yes. >> right. >> grover, what happens to all of those policies and what happens to -- i mean, i assume you want to put all of those lawyers out of work, which may very well be a good thing, i don't know, but i am curious what you would be doing right now? i don't know if you have set up some of these generations skipping trusts yourself? >> no. the only good thing about the death tax is it highlights the hypocrisy of rich liberal. they can spend their money better than the government, and they are here and the government is here and you are down below. they want to spend their money through tax avoiding foundations and trusts and so on, and they like -- they could pay the death tax, but that's not what they do. they put their money into foundations because they are

better than the government and the government is better than you. >> that's just a bunch of bs republican talking points. here's the policy issue here. >> i just made that up. it's not a talking point yet. >> i let you have your say and let me have my say here. here's the way the tax code works. once you privilege a particular type of income, and i don't care whether it's investment income or estate income or wage income, once you privilege a particular type of income that's where the army of tax lawyers comes to define every bit of your income if you can afford to hire that army under that rubric, and so then you get a ton of tax avoidance and that's what we have in this country, we lose hundreds of billions to tax avoidance and evasion. so when we talk about lowering the rate and broadening the base, and we can't have all of these generation skipping and capital gains and this type of

income versus that one, and a much simpler cleaner code is the way forward and forget about all of these special cases. >> i agree. let's not have car bouts, and let's take the tax to zero so the kennedy kids don't have to work about it, and let's take the corporate rate down which driving inversions and driving jobs overseas is our corporate rate at 35, and the average foreign about 23%, and take the rate down and go to a territorial system, and a lower tax rate gets rid of the testimo temptations to get in special deals. >> grover, you have been up this trump tower? >> i have not been up to trump

tower. we are working with our friends and the senate, and trump is doing fine on his appointments. >> don't be on your phone all day long in case they are trying to call. do you have call waiting? >> i have my phone right here. >> all right. >> wait, i think they are on. donald, what is up? >> ask for mr. blue. don't hold your breath. >> they call it white house north. >> and phaeur log yo, white house south. coming up, 'tis the season for giving and as part of the share kindness campaign, we are talking about the importance of reading and summer school and two veterans tell us why they are taking the lead on summer education.

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the nbc universal family celebrating acts kind and small with the share kindness campaign. let's bring in margaret mckenna, former president of the walmart foundation and now serves on the board of summer education program. and their organization promotes summer learning, as research learns that children that do not read or learn during the summer lose two to three months of knowledge every year. good to have you here.

you leave the walmart foundation and you go on and do something else. why this? >> when i went to the walmart foundation i spent 30 years in education, and i thought i knew everything about education and it was the hardest thing to choose something to give money to education, and i knew too much, and when i looked at everything, some are learning the return on investment to invest in summer learning was the best return on investment. the research is there. >> for example? what happens? >> because students lose two to three months every summer, they lose two to three months every summer, and the accumulation, the acumulative affect is when they enter ninth grade, over 50% of the achievement gap can be attributed to summer learning loss. >> jim, why it is

disproportionately affecting poor children? are some children going to summer school and what is happening in their lives where this doesn't happen? >> it's my view that talent and drive and ambition spread equ equally over economic classes and ethnic classes but opportunity isn't. during the summer, those children from low-income homes and families don't have access to any kind of program. children from wealthier families, they are going to museums and learning programs and they are playing in athletics and there are all sorts of learning going on, and parents are reading and they have supervision and structurst and children from low income families don't have that, they don't have structure and they are losing two to three months and it's acumulative, and by the time they get to fourth, fifth, sixth grade, they could be two or three years behind and that's when they begin to get

frustrated. >> when people give money to your organization, what are they paying for? >> for us to make summer learning programs better, and we can assess programs and train people to put on better programs and help school districts figure out a way to get money allocated towards summer learning, and as margaret said, there's no better investment. >> how many kids you have helped or are you working on and what is the goal? >> millions and millions of kids every summer. we are not talking about summer school, but we are talking about some summer experience. this is keeping libraries open, and this is -- >> how do you make sure the kids go to the library? >> kids want to do something. they want to sit in front of the tv all summer, and kids gain weight in the summer, and we are talking about health and nutrition and reading and math. it could be low touch or six weeks of intense -- we are not talking about school.

we are talking about summer experience. >> i am confused. you are paying for a school library that would normally be closed that would now be open as opposed to the city or county library? >> that's right. the build something there, and it can offer offer jobs for older kids to be the monitors and supervisors in those school libraries. very dollar cost efficient program. the school is open. we can get kids employed and other kids to come in and read during the summer. >> how much do you have under -- we would say under management. you've got an annual budget of? >> we have a couple million dollar budget and we're out raising money all the time. summerlearning.org is a place to visit. >> good marketing. there you go. >> typically we work with the white house and department of education to put on a terrific national summer learning day. we reach over a million kids. several thousand programs. they're not all in school districts. some of them are at the local

ymca. >> okay. >> some at other programs, other facilities that push and promote summer learning for those kids most in need. >> fantastic. >> and we're trying to reach parents. >> sure. >> the parents can go to an app and find out what they can do for their kids in the summer as well. >> terrific. thank you, lady and gentleman, we wish you the best of luck and success with this. >> happy holidays. >> thank you very much. >> you too. when we return, we're going to hang out with jim cramer from the new york stock exchange. in the meantime looking at futures, we are looking like we're in the green. come down a little bit here, dow open about 13.5 points up, s&p 500 up about 3.5 points. back in a moment. there's a denture adhesive that holds strong until evening.

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let's get down to the new york stock exchange. jim cramer joins us now. one of the things that we keep revisiting is the steve eizman interview. it's funny he loves dodd/frank and doesn't want anything changed, but assumes there will be some changes and because of that he lofs the financials. he's buying them and wants to buy more. so it's a good bill, but if you do get rid of parts of it, it would be much better for the financials. we didn't really understand that. >> yeah, listen, i don't know how he understands or can rationalize how goldman went

where it went to because goldman where it is gone is about repealing some onerous parts of dodd/frank. look, it's very easy to say, i think this market is going up big and i don't think any of this stuff trump's going to do is going to happen, and say how can you say that, cause i just said it, i can say whatever i want because it's my damn show. >> you can. gave a lot of things that were absolutely facts. >> he contradicted a previous guest, said the guest didn't know what he was talking about. look, you can say what you want. there's fake news, real news, there's reddit, there's sites, say whatever you want. i don't know, i'm stuck with the facts. i do all this work. and maybe it's just a darn waste of time, but i'm going with it. it's all i've got. >> i love the fake news stuff, because it's in the eye of the beholder. that's the weirdest thing. >> right. >> it's so subjective. it's like i wish we knew, because we really don't. because one person's fake news is my real news, and another person's real news is my fake news. >> but look, impiricily goldman

went from x to 2x. >> right. >> we can say lloyd blankfein came up with a great way to make money, but again, i'm stuck with the facts. the facts stink. because they justify it. >> all right. jim, don't move. >> i'm sorry to be hot, but i'm listening to the guy and i'm saying, hey, let him get away -- let everybody get away with everything. what the heck. it's all fake news. we know you're allowed to have fake news. they validated fake news. so, i mean, so what? look, orrwell had it dead right. >> he did. >> he was a visionary. >> yeah, good group. thanks, jim. see you in about four minutes. when we return, an upgrade for wholesale retail. your stock to watch after the break.

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i didn't think it would work, but it does. it's called always discreet watch this. this super absorbent core turns liquid to gel, for incredible protection that's surprisingly thin. so i know i'm wearing it, but no one else will. always discreet for bladder leaks welcome back to "squawk box." stocks this morning to watch, mosaic striking a deal to buy the verlz business of brazilian mining business vale. about $2.5 million in cash and stock. the firm says it sees a clear path to accelerating sales thanks to the abatement of deflation in food and gasoline.

lennar earnings and revenues topping wall street expectations. lennar sold more homes at higher prices compared to a year. >> they have you on that commercial. >> yes. >> it says trump rally and it's got you talking about -- >> like that's the shot. can you get that shot? right there. >> they didn't see the irony? they're yanking your chain for doing that. >> yanking your chain. >> they are. make sure you join us tomorrow. "squawk on the street" is next. ♪ good monday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer at the new york stock exchange. david faber is off today. final two weeks of 2016, dow's coming off a six-week run. but futures are mild. europe is just shy of the flat line. that ten-year yield near 2.55 this morning. our road map begins with the march toward the big rally as the man behind the big short goes big on the