♪ >> live from new york where business never sleeps, this is "squawk box." good morning. welcome to "squawk box" here on cnbc. i'm melissa lee along with joe kernen and kayla tausche. let's look at u.s. equity futures as we continue the march to dow 20,000. about 58 points away at the close yesterday. right now we are indicated to open lower across the board. s&p looking to lose about 2 at open. nasdaq down about 6 at the open. worth noting that yesterday was a very, very tight trading day. 45-point range. that was the tightest in about two years. looking at the action in asia, hang seng saw the most action, down by 0.8%. in europe, the picture there, big news there is on monte dei paschi. we are seeing red arrows across the board except in italy, thanks to the gains in that bank. looking at the dollar index, we

are actually seeing the euro turning lower here. looking at crude, the picture in crude, wti down by 0.4. date to for brent crude. here's big stories that we are watching today. another wild trading session for the world's oldest bank. shares of monte dei paschi tell 7% in early trading after the embattled lender admitted there are no anchor investors taking up its share sale. a state bailout is expected with any losses forced on to bond holders. the president-elect is tapping carl icahn as a special adviser. the billionaire investor will work on rescinding what he calls excessive regulation on u.s. businesses. the transition team says icahn will not be a federal employee, and he will not take a salary. another well known face to cnbc viewers is getting a job in the

trump administration. the president-elect is hiring economist peter navarro to run a newly formed national trade council. navarro is the author of "death by china." he backs a hard line approach towards relations with beijing. it is a newly formed group. it will be interesting to see how this group interacts with the other existing trade groups already in the administration, other diplomatic channels with which the administration will be dealing with china. >> navarro sat here many times. we had him in debates with people from the other side. i client believe he lived in california. he mentions it's in orange county. >> he's not black sheep. >> not in orange county as much as he would be in the rest of the state. but very outspoken when he comes on. a great debater. sometimes if i say, wow, this guy is right, right of center,

then you know he's definitely -- he is. >> perhaps a bit of a good cop bad cop situation, he can say a lot of things that everybody -- >> the administration would want to say, but formally cannot. >> someone wrote in yesterday, there's a lot of people that we know well on this show and cnbc that are in the administration. >> yeah. >> including wilbur ross. >> carl icahn now. >> navarro. across the board. >> you should tell "squawk box" guests they are basically auditioning. >> i think they saw speaker ryan begin his career as a guest host here. >> you are taking credit for the rise of all these people in the administration? >> it may not be a pure cause and effect. >> maybe a contributing factor. >> you basically screened half the administration. >> we need to vet people. we do our part.

>> so patriotic of you. >> this was deep yesterday, president-elect trump, these guys -- if you are the president and your company -- it's not to say you have to kiss up to the government, but there are things that the government can do that it's better if you're on their side, right? >> i'd rather be with them than against them. >> these guys are getting in line quickly, guys and gals. >> their business is government. >> exactly. trump meeting with defense company ceos yesterday at mar-a-lago, his resort in florida, including lockheed's martin ceo and boeing's. trump caught both companies by surprise last month when he tweeted about the high cost of the f 35 fighter jet program, as well as the contract to build a replacement for air force one. trump extracted a pledge from the boeing ceo to keep costs for that presidential plane below $4

billion. >> we'll get it done for less than that and committed to working together to make sure that happens. i was able to gift president-elect my personal commitment on behalf of the boeing company. this is a business that's important to us. we work on air force one, because it's important to our country. we'll make sure that he gets the best capability and that it's done affordably. >> the boeing ceo said once the requirements for the presidential plane is set and the price is affordable, production will start. when trump was asked if he secured congrecessions on the f he said it was too soon to know. people have posited that boeing doesn't make a lot of money on air force one, it's more of a prestige thing, and that maybe

you shouldn't be gouging quite as much as you are on other programs. >> r&d on these planes alone is north of $2 million, they have advanced communications and weapons systems that we don't normally have on a private jet. >> you know how a lot of times government contracts -- the people are not quite mining their ps and qs as they would with a private sector order. there might be some government waste, look at medicare. not necessarily a line of command and accountability. >> now there's motivation to get one. >> do you have a driver's license? >> i do. >> dmv. >> yes. >> people are on 33 speed versus -- >> i don't know. i will say financial district dmv in new york city, i wo like would like to raise a glass to those people, they get you in and out quickly. >> i went to a parking ticket infraction, i watched the wheels

of justice. >> this to the point of the government waste and -- >> what do you mean? this whole dmv -- >> anything -- any experience i've had in government -- >> yeah. >> who will yell at you when there's no one to yell at them, above them there's nobody. >> you're saying you didn't deserve the parking ticket? >> it wasn't my parking ticket. happened to be in a car that -- it's a long story. >> by the way, you know what these companies have done since donald trump tweeted? boeing up 4%, lockheed martin down 3%. the impact is small. bed bath & beyond's third quarter profit fell missing forecasts. growth in online sales could not offset a drop in traffic at brick-and-mortar stores. the company expects full-year earnings to be at the low end of the usual range. shares off about 2.5%. micron's first quarter profits beat analyst profits. the company expects second quarter earnings to come in well above expectations.

that stock up by about 10%. herman miller's second quarter results and third quarter outlook missed forecasts. the maker of home furnishings citing weakness in the north american market and pointing to uncertain global economic and geopolitical climate. all right. today is the busiest day of the week for economic data. weekly jobless claims, november durable goods data and the final estimate on third quarter gdp are all out at 8:30 a.m. eastern time. growth is forecast to be slightly revised higher to 3.3%. at 10:00 a.m., november personal income and spending. an important metric in the discussion about wages, which is one we've been having as regards to inflation. >> and we had a modest pullback. talk to a couple of stock analysts here. i don't know, buy side or sell side. but a bit weaker yesterday.

the dow still cloese to the 20,000 level. we are joined by karen cavanaugh, and martin lucinni. just looking at your thoughts, both of you together, i wouldn't necessarily say that you're saying it's a show-me market right now. but you both have concerns, and you both make the same points. number one, the dollar could get stronger. that might eventually be a he headwind. a lot of these things we assume need to get done, they need to get done or we're ahead of ourselves. karen, you start. >> exactly. that's what it is. i think we will see 20,000 if we get good data today. i think we'll see it by the end of the week. things are generally good. we're on a whole new road. we haven't been on this road before. it's a new path.

economic data is good, corporate data is good. people are worried things are getting frothy, yeah there are some animal spirits out there finally seeing pro growth policy potential, but the underlying fundamentals are good. that will push us forward. there's always risks. always risks out there. if you wait for the dust to settle you will never invest. if we see good data today, we could hit that milestone. >> yeah. doesn't have to be congress either, doesn't have to be legislation. could be deregulation. i wonder whether there's that much risk to whether these things happen. one thing will happen, on january 20th, there will be like a czar, we already heard about carl icahn. in terms of what you could clean up from the private sector with these regulations still being put on in the 12th hour of this presidency.

there is no risk of whether it gets passed. they'll do that with a pen. don't you think? >> i agree. a lot of that can be rolled back by way of executive order. we know that surveys taken of businesses from ceos of large companies, the duke survey to small business survey cite as number one government regulation and then along with it taxes as being those things holding back, if you will, the animal spirits of business owners in the suite making decisions about plans and expenditures. so that will continue to promote more positive sentiment among the business community which will create a self reinforcing cycle in the labor market which is good the incremental boost could come from businesses which have been absent from spending

the last couple of years that could boost economic activity almost without regard to the prospects for infrastructure which i'm not sure as a consequence of deregulation and corporate tax reform might be necessary to boost incremental demand in this country. >> i think the 12th hour -- >> i totally agree with mark. that's absolutely true. >> hold on. i think the 12th hour is too late. it's an 11th hour decision. >> 11th hour. >> 12th hour, it's over. the 11th-hour regulations. i always wondered why isn't it the 24th hour or 23rd hour -- >> we're in the united states. i don't know what they say in europe. >> i don't know. i think if you got a tax reform bill, karen, you cut corporate taxes, and you make it simpler, do all these things, that might be worth 30,000. 20,000 -- >> yeah. right. >> the regulation, just do the regulations, you're probably good for 20,000.

>> i'll take any of them. at voya, we have a price target s&p 500 for 2017 of 2400. but if we see some -- >> that's weak. that's weak, karen. move it up. >> well -- i want to move it up, but there's more risks out there. i'm hoping i'm on the down side. we had 2250 for 2016, we're close. >> what's the return if it goes to 2400? i might as well stay in cash. >> yeah. >> you have to raise that. >> okay. all right. i'll go back to the drawing board. >> see, mark -- mark just -- mark just raised it. >> we should see something good for 20 17. >> mark, now you will raise yours to 2700 so i don't say something. where are you right now. >> i'll base case is 2410. >> the price is right. >> 6.5% out of the money. 2500 optimistic.

2500, if we get the great rotation from bonds to stocks, some of that money comes into the market and we get this performance chase, which we know is already underway, i think we see 2500. >> i'm saying 2510 then. 2510. >> say $1. >> i want 35% or something. remember those three years in the '90s, three straight years of 30 plus percent? i guess those days are gone. i want 3.5% -- >> let's see if we get these pro growth policies. we are on a whole new path. we don't know. we might be pleasantly surprised. >> love to be wrong and underestimating that return the same. >> all right. we're at 15 this year, right? we weren't supposed to be able to do 15 again. we've done 9% since the election. we were stuck at 6%, 7%. you even needed dividends to get there. we got to this sub 2% gtp growth

and no stock market moves in the last two years. maybe we'll be surprised. >> maybe the time is right. >> maybe things are not quite as hopeless as some people are telling us. thank you both. >> thanks. >> merry christmas, happy holidays what are we saying now? ej is mad about saying merry cra christmas. >> why. >> because of the political christmas. trump said say merry christmas. e.j. dion said he had to write something about it. it was in the washington come post - post. >> coming up, the new white house national trade council. eamon javers has the details next. world ugly and messy.

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news out late yesterday from president-elect trump's transition team, carl icahn will advice trump on business regulation as an adviser. and peter navarro will head the new white house trade council.

eamon javers has more. >> these are two trump supporters being rewarded with positions close to the position of power in washington, d.c. next year. starting with peter navarro. let's give details. he's been selected to head the new white house national trade council. this is a new group that we have not seen before. raises the level of trade to white house significance under donald trump. he's an economics and public policy professor at the university of california. he has a ph.d. frof economics fm harvard. he is a china hawk. as hawkish on china as you can be on trade. this will be seen in bay swieij a poke in the eye. trump wants this voice inside the white house advising him on trade policy going forward. look at carl icahn, billionaire,

again, cnbc viewers will be familiar with this name. a special adviser to donald trump on business regulations. chairman of icahn enterprises, he has 55 years of experience on wall street. also a philanthropist focused on education and homelessness. he opened seven icahn charter schools in new york city. somebody deeply involved in education as well. we'll see whether his advice to donald trump takes him down the policy path on education or on business regulations. one concern for the trump team in appointing carl icahn to a formal position here as opposed to an outside kitchen cabinet member, which he has been to date, will be this question of conflict of interest. a lot of critics will be swirling around icahn's businesses and what specific advice is he giving donald trump's team and what businesses he owns benefits from that advice. if he is seen as lining his own

pockets on policy decisions, that could be an area of criticism for the trump team going forward. >> already, he's criticized renewable fuel mandates and the cost associated with that to the oil and gas industry, because he has holdings in gas and refineries. even at the surface right now there are some potential conflicts you can identify and point to. >> as a billionaire, his holdings are so vast. he will have so many different pieces of so many businesses, it will be hard for him to advise any regulatory cutback which will not benefit him personally. the trump team has this theme of conflict of interest out there. they're adding to it with carl icahn. if they kept him as a nonofficial adviser, a guy that donald trump occasionally has coffee with, that's one thing. now this opens them up to constant monitoring by critics and antagonists in washington. that will ab constant theme going forward. >> icahn's probably got 10, $15

billion. he's 80 years old, can't possibly spend it. gives most of it away, the left, that's what they'll look for if he can make an extra 100 million here or there? >> i think so. >> if he wouldn't possibly spend the 15 billion he's got and giving it away, oh, he made a couple hundred dollars. it's ludicrous. what was the other thing i was going to say, uc irvine, university of california irvine. make that -- orange county. i don't know. he might not -- >> separate from the rest of the uc system. >> i know, it's what people do. accountability. we have to watch the conflict. i understand. i just think we should keep it in the real world occasionally. it's not someone that left the white house broke and then was able to get $750,000 per speech because his wife was going to be president. it's different.

he's got 15 billion already. he doesn't need to game the system -- >> he can't continue to run against hillary clinton. your comment there draws a contrast. that was effective on the campaign trail this is a new thing. >> i got it. i know people will be all over it. >> let me -- let me just bring in a point if i can of somebody i talked to yesterday, who is -- who is inside trump land, so to speak, who gave me a good sense, a brain dump on how wall street might be getting this trump team wrong. this person said that one of the things that wall street is so exuberant about is low regulations and low taxes. that's a traditional republican government. but he said this is not going to be a traditional republican administration. bowing at the altar of free markets is out under this administration. he said crony capitalists will be on the dart board. i think that's pretty much what you saw yesterday with the boeing and lockheed meetings. donald trump not somebody who is afraid to single out individual

ceos of individual companies. this company reminded me trump voters said we want you to go to washington and pfrunch it in th throat. by bringing in guys like navarro and icahn, these are outsiders coming into washington, this is an aggressive shake-up move. >> carl is so good at seeing things the way they are, situations. who needs this for him? he could stay out of public life completely and do what he does best and make so much more money than going in and trying to help his country for a specific reason. that's what's so annoying to me. >> the question is -- >> why do it? i wouldn't do it? >> if he doesn't need it, why take the title? >> if i were icahn i would say, you know what? never mind. i would. >> if he doesn't need t why take the title? he's got a direct phone line to donald trump. i'm sure he has his krelcell nu.

>> time for your holiday weather forecast. time for wolf reynolds. you ni that wknew that was comit you? you could do either, and be cool. >> interchangeability. >> i have never seen you in the bowtie either, dude. it's been a long time. >> i'm channels my inner orville reddenbac hshg reddenbacher. out west, over the four corners, rain, sleet, snow, good news for vail and aspin. good snow. tomorrow's forecast, this one system that was in the four corners, it will grow some legs and make its way over towards the great lakes. in o'hare, st. louis, you could

have delays. back out to the west, more rain for southern california. that's great news, for a state dealing with a drought, wonderful, for travelers, not so much. we jump from tomorrow and spring forward into saturday. more snow possibly for upstate new york, back to maine, verm t vermont, new hampshire. sunday we have more issues moving across parts of big sky country, the great lakes, rain and maybe storms for the southern plains. back to you in new york. >> thank you very much reynolds wolf for that forecast. coming up, 2016 was a slow year for ipos, but we're seeing signs that perhaps twice as many companies could go public in the new year. and we'll tell you how safe your data is when you shop online at some of those popular retail sites.

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♪ >> is that edible in is that here? >> right there. go take a bite. >> welcome back to "squawk box" on cnbc. u.s. equity futures at this hour are just slightly lower. down 7 points or so. are there gummy things on there? >> didn't get that close. >> wow. >> looks tasty. >> i guess we have to save that. >> why? only a couple more days. nobody will notice the door missing. >> that's a beauty. uber removed its serve driving

cars from the streets of san francisco amid a dispute with california's department of motor vehicles. it's all coming back to us. already had a discussion about the dmv earlier. uber began testing the cars earlier last year, but the dmv said they had not obtained the proper permit. uber claims it doesn't need a perfect because the cars have a human monitor behind the wheel. the dmv and california's attorney general are threatening some legal action. in other news, on the ridesharing giant, uber is launching its first fleet of electric cars in madrid. the company hopes the cleaner cars will improve its image in that city run by an environmentally conscious mayor. last month madrid unveiled new measures to fight pollution, restricting private traffic in the city center and tightening speed limits.

>> we saw 112 ipos in 2016, but all that could change next year with with the unicorns waiting in the wings. jackie young joins us. uber expected to go public next year along with snap. overall the trend for 2017 is what? more deals, smaller deals? >> i think it will be a positive year. i think we'll see deals of all sizes. we'll see some larger deals, some spins. we'll see the unicorns coming, really companies from all sectors. >> what is the impact of the unicorns going to public on the other tech ipos looking to go public? does this suck the oxygen out of the room? make it more difficult for others to find funding? >> if these tech companies go out, this will set a solid foundation for other technology companies.

you can see the door opening wide for other technology companies to go out. >> we have the markets almost every single day trading at a new record, let's say that continues into next year. does that ultimately bode well for the ipo market, or whoever is buying an ipo for a money-losing company like snap or ub ser is buying at the top? >> the challenge is sustaining that valuation. the equity markets are at all-time highs. investors will be discerning, they want that top line growth but also profitability. >> who will the investors be? so much money flowed into these companies, they have been ability to raise money over and over and over again. is it mom and pop who will get into the stocks? >> the big investor also still be in the stocks.

private funds have been making private investments into these companies, and that's great because they're maturing. the big investors will be backing these deals. >>let care led the ipo market in 2016. will we see a dearth of healthcare in this ipo market? >> deal sizes are getting smaller in healthcare for sure. >> harder to mraplace. >> more challenging to place. you have to be a strong company. >> what are some other unicorns that not many people here in the united states are paying attention to. we had a number of black buster ipos overseas what are some ones that you're watching? >> companies around the world are valuing all different types of exchanges.

companies abroad, you may think they'll be listing in the local markets, but companies are lining up already for 2017 that are international. they are planning to come to the u.s. we have some of the strongest capital markets in the world. coming up a special holiday edition of executive edge, new numbers on travel, and the quiet return of the cal street holiday party. here's a quick look at what's happening in the european markets. i think a lot of people are already gone. we'll check in from st. baarts when we return.

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welcome back to "squawk box." let's look at equity futures, still indicated open lower here. on the dow, lower by about 9 points. shares of actelion surging as johnson & johnson resumed talks to buy the dugmaker. a deal would be cortisone $30 billion.

re hershey has named its new coo as michelle buck. in other corporate news, there's a new game from nintendo, it's for small phones, it's the new mario smartphone game. it set a download record, which is unbelievabilitunbelievabil u downloads in 4 days. analysts worry that gamers are balking at the one-time cost. you get to pay the first few levels for free, then it costs

9.99 to play the rest. the stock is down 15% saince th game launched last thursday. >> i would think in theory that's a good strategy. people want to beat the game. keep going. >> but they're not doing it. 9.99, no. >> sorry, i'll play candy crush. >> how do you make money? this whole digital world. twitter, the minute you say we'll charge you, peel go fine, i'm getting something free elsewhere. the internet is a great -- you look at what it's done for silicon valley, all these gazillionaries, it does bring down costs. >> it commoditizes everything. >> most of the time things get cheaper. >> you find out how sticky your product is. time for the executive edge. it's projected to be a record year for a number of americans heading out of town for the holidays.

103 million americans, the most ever on record, will travel for the holidays. the vast majority, 93 million, are driving. aaa says the number of flyers will be up 2.5% over last year. where are people going this week? mostly someplace warm. aaa's travel agency says vegas, orlando, new york, san diego and anaheim are the top five spots being booked right now. maybe a little disney theme to that, too. >> these holiday parties i'm reading about, they're back on wall street. the party scene at least for christmas, for this year. big banks had cut back year-end bashes during the financial crisis, some stopped sponsoring corporate gathering altogether, advising individual teams to use their own budgets for smaller parties. now things are weird, as it seems to be correlated with

what's happening politically. now the climate is more optimistic. holiday party spending is still down compared to 2008. firms don't talk about it, they're reluctant to talk about the soirees, trying to keep the parties out of the public eye. we did have this year, pimco had a flash mob of dancers at its holiday gathering. blackstone had a black tie celebration at the waldorf. apollo hired live statues, humans to stand completely naked -- sorry, completely still. completely still. >> they could also be naked. >> they could be. a lot of statues are. they were standing still and painted like marble. a far cry from the pinnacle of the -- >> yes, but 2008 social media wasn't in its heyday then. you didn't have instagram, snapchat. >> i was thinking of dennis kozlowski and the statues, you could fill up the vodka.

just the complete over-the-top parties that wall street used to have. >> i'm sure workers out there are thinking it's great the parties are coming back, we want the bonuses to be better this year. bonuses this year have not been good. those paychecks will come in. >> or want the bonuses back in cash. >> great, we have a soiree. >> the smartphone video that everybody has makes christmas parties much less -- >> rambunctious? >> yes. i would be hesitant. you don't put a lamp shade on your head. >> the things you used to do. >> the things that used to happen. >> when you were in boulder, it didn't matter. you were in your dorm setting every night. >> that's right. but everything used to go at these christmas parties. the original "die hard" people in a room. >> seven deadly sins thing. >> social media and the selfie,

that changed a lot of things. >> first the volker rule needs to. the u.s. is facing a major shortage of eggnog this year. all because producers underestimated high demand. organic valley telling the "wall street journal" eggnog sales are up 60% over the last year compared with 5% increases in recent years. i don't like eggnog before. >> i never had it before. >> what? somebody needs to get kayla eggnog right now. >> it's fattening and it has alcohol. >> i'm starving, this is my breakfast here. >> look at that. >> you took the head off one of those guys? you couldn't even wait until after the show? >> i'll take one for the team. i won't say who it really was, joe. >> i wonder who. coming up, we'll eat about half of this during the commercial break. when we come back, how safe is your data when you make

purchases online? we'll ask the co-founder of bitsight technology, who issues daily security briefings for businesses that we interact with every day. coming up, the dow within striking distance of 20,000. will the trump rally power through the milestone? or will bears take control and spoil the party? we'll talk strategy after the break. this car is traveling over 200 miles per hour. to win, every millisecond matters. both on the track and thousands of miles away. with the help of at&t, red bull racing can share critical information about every inch of the car from virtually anywhere. brakes are getting warm. confirmed, daniel you need to cool your brakes.

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welcome back to "squawk box." the u.s. is returning china's most consumer to consumer shopping site, putting it back on the black list of notorious marketplaces. this move against the alibaba online shopping site follows complains from u.s. and international trade groups that argued that -- i know it's follow the dow, is it tshdaobao taobao? the restaurant is dao over here.

>> are you sure it's not tayo? >> could be that, too. >> if you follow it, it's >> yeah. >> anyway, i'm going to call it taobao. it wasn't doing enough to police the sale of faked and pirated products. the u.s. trade representatives' office said it is unexpectedly high. well, home depot and vera bradley were among retailers suffering the data breaches this holiday shopping season. with more on keeping your information safe while doing any last-minute online shopping, let's bring in steven bowyer of bitsite. steven, we haven't really heard that much about any retail breaches. i mean, perhaps everyone was talking about this massive breach at yahoo last week that we haven't been focusing on it.

but is there anywhere customers should be worried about typing in their credit card information? >> yes, well, many of these breaches have been out of the headlines because we've seen such large breaches like yahoo an the dnc hack. we've seen top 100 retailers by revenue, niemann marcus, you're talking kohl's, wendy's. so that was earlier in the year. even in the last few months we've seen vera bradley and eddie bauer. it's demonstrating that retailers are still vulnerable and need to remain vigilant. >> for people doing so much of their shopping online, what tips would you have for them just generally? i mean, to use a credit card that has coverage instead of a debit card? what are the rules of thumb that people don't necessarily think about? >> sure. well, you have the consumers and then the businesses. let's start with the consumers. the consumers obviously need to monitor. they need to monitor, understand what transactions are happening

maybe on their credit card. if you pay cash, that risk is a bit lower. you need to monitor. most of the banks are pretty good at refunding the fraudulent charges. but you need to watch the fraudulent charges. businesses on the other hand need to put in good controls. they need to be able to monitor and protect, not only look at their own systems but their supply chain and watch that dij lently. >> your company bitsite provides these security ratings along the lines that moody's does out there. so i'm just curious given the hacks that has pulled off on the twitter accounts of marvel and netflix, how much of an impact is that or would that be on twitter's rating, for instance? >> well, some of those impacts are really not something that the company can control. like, a distributed analysis attack is not on the company. but it is an impact on their operations. right?

and their ability for people to use that has an impact in insurance where somebody may have lost revenue from downtime where you think about other controls that they need to put in place such as good pass control, multi-factor authentications. a lot of these breaches happen because somebody had a very obvious detail that they overlooked or a well known vulnerability that someone exploited. this is where businesses need to make sure they're watching what they're doing. and really put in best practices for execution. but in the case of downtime from yahoo, it's more of an operational impact as opposed to a loss of data you've seen in other breaches. >> what are some of the highest rated businesses that you've seen, stephen? >> well, so the financial services has always been at the top. when we see that, it's because they put in the best controls. they have a very good culture of risk management. when we see retail, it's kind of in the mid-tier where they're performing in the middle of the group of the different

industries. it's interesting. there's a little bit of a have and have not inside of retail. the top 100 retailers by revenue have actually gotten better. we've seen that they have put in good practices and improved based on data and measurement, but outside of that, you start to see a lagging group where they -- even though they're aware and i think at this point i think everyone's aware of the risks in the cyber security world, but they just haven't had the wherewithal or revenue to make the improvements that they need. >> the smaller the company is, the less they're able to spend to actually safeguard their site. so should shoppers just avoid them completely? or should they try and buy those products through amazon or some sort of aggregating shopping site? >> you're going have a span, right? not all retailers are the same. it's not just avoiding the smaller players and going with the bigger ones. the bigger ones will have better controls because they're larger and have more resources.

but i think you have protection with your credit cards and monitoring that. even smaller retailers, they will have put in some sort of protections. there's something called. r pci compliance. so maybe the small retailers are using someone who provides transactions to protect that. it's not small versus large. it's just somebody who put in the protections to protect consumers. >> well, it is important information as people are doing their last-minute shopping. stephen, we appreciate it. >> thank you. >> stephen bowyer from bitsite. annual christmas lottery taking place today with a whopping $2.4 billion on the line better than known as el gordo. the annual drawing has been dubbed the world's richest sweepstakes. the catch, no one actually walks away with billions. and it's probably in euros. so it's not what it used to be. the grand prize is about $4 million before taxes. still almost 15,000 people cash

in on some kind of winning ticket. with many buying several tickets with the same number to maximize their potential earnings. doesn't seem quite right. that's 2,400 million. >> el gordo sounds like a t-shirt you'd get for eating. >> like a hot dog contest. >> if you get 2,400 million to deal with, why is the biggest thing only 4? must be spread out a lot. >> we have some news coming in. kellyanne conway has been named presidential counselor special adviser to president-elect donald trump. kellyanne conway officially getting a title in the trump administration at this point. >> she was moving to d.c. with her family. coming up, the dow pulling back on tuesday's record high but within striking distance of 20,000. we'll talk a possible santa claus rally after this break.

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will today's economic data push us over 20,000? a look where to put your money to work now as well as 2017. that's straight ahead. plus is it too late to ship that last-minute holiday gift with just three days to go before santa's arrival? a look at same-day delivery options for the ultimate procrastinators. and warm hats, warmer hearts. a look at start-up company love your melon. their hats are quickly becoming a huge hit across the country. and they're donating millions to battle childhood cancer. their story is straight ahead. as the second hour of "squawk box" begins right now. ♪ live from the beating heart of business, new york city, this

is "squawk box." >> welcome back to "squawk box" here on cnbc. i'm kayla tausche along with joe kernen and melissa lee. we're watching the futures this morning after getting very close to 20,000 earlier in the week. we did see a pullback yesterday and the futures are in negative territory if only slightly so. the s&p would open lower by two. the nasdaq would open lower by six points. in an announcement we just told you from the trump transition team, kellyanne conway who successfully managed the victorious trump campaign has been named counselor to the president. in a statement trump said she played a crucial role in his campaign. she's a tireless and advocate of my agenda, has amazing insights on how to effectively communicate our message. i'm pleased that she will be part of my senior team in the white house, president-elect said. he said conway will help him

execute some of the administration legislative priorities. kelly ann in her words said i want to thank the president-elect for this opportunity. a trump presidency will bring real change to washington and to americans across this great nation. i am humbled and honored to transform the movement he has led into a real agenda. and didn't know what she was going to do or if she was going to do anything. >> she had said that she politely declined press secretary. >> but she was moving to d.c. we heard earlier this week. >> there was talk she would be running part of an external organization supporting trump. this is obviously inside the fold now. >> yeah. president-elect trump said i'm pleased she'll be part of my senior team in the west wing where president martin sheen used to -- was he not really? >> also president, michael douglas. >> many. >> yeah. here's what's making headlines this morning.

an entire week of data stuffed into one busy morning. 8:30 eastern time sees durable goods in the third quarter estimate of gdp and spending. that's out at 10:00 a.m. eastern time today. and also the index of leading economic indicators at 10:00. the u.s. has put a unit of china alibaba back on the market place blacklist. the trait representatives' office cede taobao. >> if you follow the tao -- >> i don't know many people would know what you're talking about. >> it sounds like a market, index. >> we're talking about taobao. it's not doing enough with the sale of intellectual property rights. alibaba says it's disappointed in that decision. one of this morning's big stock makers, micron beats

estimates. stabilizing personalized computer stock. 56% run up this year. adding about 11% to that run this morning. joe? and now to politics and the trump transition. the president-elect is tapping carl icahn as a special adviser. the investor will work on rescinding what he has referred to as excessive regulation on u.s. businesses. the transition team says icahn will not be a federal employee and not take a salary. probably not a surprise. >> well, the president himself is only taking a $1 salary because he has to. also getting a job in the trump administration, the president-elect is hiring peter navarro to run a new trade council. the group will be based in the white house. navarro is the author of "death by china" and sharply criticized china's economic and military

policies and backs a hard-lined approach toward relations with beijing. switching back to the markets as we come to a close in 2016, cnbc is looking at ways you can make money in the coming year. this time we're looking at the u.s. markets. here's bob pisani. >> reporter: stock rally, oil rally, everyone's bullish right now but that's going to get tougher in 2017. here's three predictions. first the stock rally will continue but hit major headwinds. the s&p 500 will hit a series of historic highs again within the first hundred days of donald trump taking office. but that will be it. the problem? market participants are anticipating much higher revenues and earnings due to tax cuts and fiscal stimulus. but the company guidance will not match those high expectations. second, the oil rally will be a bust. as oil heads towards $60, america producers will ramp up production. that will keep the prices down and the discussion between opec and non-opec members to cut

production will collapse. finally, 2017 will be the year stock ownership expands. the american public has seen declining levels of stock ownership for years. only 52% of households own stocks and most is owned by the top 10% of households. but rising gdp will finally reverse those trends in 2017 and folk who is abandoned the market after the financial crisis in 2008 will return and start buying stocks once again. wouldn't it be nice if more households actually owned stock? 82% of all stock is owned by the top 10% of all households. ownership has become concentrated in a smaller and smaller subset of american households. maybe this newfound enthusiasm for the markets will really translate into broader ownership of equities. that's my wish for 2017, joe. >> okay, robert pisani. thank you.

>> thank you. >> how long -- i'm looking at you. we've been together a long time, haven't we? maybe longer than our marriages, don't you think? >> i just did this 30th. >> all right. okay. >> but you and i, 25 years now. >> yes. longer than my marriage. and i don't think we ever fight, do we, really? >> well, you're kind of like my brother. i disagree with you sometimes but i love you too much to give you too much of a hard time. >> you know, you just gave -- i wasn't going to bring that up. maybe we are going to fight. whose predictions were those? yours? am i supposed to write those down? why -- someone just sent in jeff bridges as the big lebowski saying that's just like your opinion, man. why do we care about your opinions, bob? >> they're all mine. and we care about them because they ask me every year, bob, what do you feel? and i said, these things i feel strongly about. i wrote down seven, eight, nine, ten of them and eliminate them by elimination.

elimination. >> all right. we're going to watch and get more predictions now. so much for a quick surge over 20,000. the dow failing to top the milestone number once again as volatility drains from the market. that's for sure. we saw the tightest trading range yesterday in two years. joining us now phil orlando chief equity strategist at fed rated investors. in your shops, you start seeing not quite as many people around doing stuff. i mean, it's a slow week isn't it at this point? >> it's a slow week, but our financial advisers are very busy. they only have a few more trading days to get things done in client accounts. so the financial advisers are around. >> okay. phil, if you got enough probably seniority and if you've got, you know, if you can go to st. barts you're probably in st. barts right? >> tomorrow's my last day.

i'm going to take some vacation time. volumes are starting to slide and we're expecting volumes are going to be light into the new year. >> does that mean more or less volatile? >> i think the market has largely priced in what it was going to price in through the end of the year already. so coming out of the election, we thought the s&p would respond for favorably and get to about the 2250 level and got there a couple of days ago. we're going to drift with lighter volumes. we get a correction. a lot of the enthusiasm, 20% up on the russell. you know, we've had a tremendous run here over the last six, seven weeks. >> and do either of you have big targets for 2017 or are you sort of playing it safe? you can raise it if it starts going up. >> we're at 2350 for next year and we've got a 2500 number for 2018. we've already established -- >> if we get there in january to 2350.

then what? 2500 by the end of the year? >> we're mentally prepared for the fact we could be at 2350 by the middle of the year. >> okay, joe. our high end is 2700. >> all right. all right, orlando. whap do you say to that? >> if everything goes right. everything has to go right with taxes and deductions and everything. >> so there's an asterisk. >> there's definitely an asterisk. >> what's your lower case scenario? what's your base? >> 1600. >> because if everything goes wrong -- >> that's your range. and then around 2300. this is what they should be talking about and they're not. when you hit a mild. that's why it's taking so long. >> now, our ten-year forecast on the s&p is 3500. we've had that for quite some time. if you extrapolate that and put that on the nasdaq, you're talking about the nasdaq at 10,000 in ten years.

it represents the digital era. that's where innovation is. those are the kind of things now that we should be looking at. >> 3500 by when? >> ten years. >> what is that? 3% a year? >> no. you can get 6% or 7% per year. but this is the -- >> we should be much higher than 3500. >> this is the point everybody is missing. we're in a new market and nobody wants to talk about it. we think the markets can trend up for the next ten years. the only way you do that is on pessimism and skepticism. >> we've been in a secular bull for three, four years already. >> right. the average is 14 years. it started in 2013. but nasdaq just started this year because you just took out the high of 2000 and that took 16 years. that just entered a new secular bull market. >> more immediately, though, we're going to be entering 2017

and i get the notion growth could kick in next year. we're certainly not going to see it in the results for the fourth quarter. what we might see, though, is the impact of the dollar and the higher dollar. dollar index about 14-year highs. we sort of saw that and by no means is a bellwether of any sort. it took down because of negative currency impacts. should we be prepared for hearing about that in the fourth quarter? earnings results that could be coming and could that be the hiccup in the market as we had this lull period between the hope of growth and growth actually kicking in again. >> so the earnings recession is over. we had seven consecutive quarters where we had negative year to year comparisons. the third quarter broke that trend. the fourth quarter is going to show more growth. certainly the strength in the dollar is potentially going to have a negative impact on large cap multinational companies that do have more of their business overseas. the flip side of that coin is that small caps and the russell is up 20% since the election is

that small cap companies are doing 80% or more of their business here. and the strength of the dollar means that the economy is doing better and they're doing more business. so it ought to balance out. you know, there will be a negative hit to earnings to large cap companies. small cap companies are going to do just fine. >> flip side of the same coin. higher interest rates and higher dollar. but they both come from better economic growth. >> exactly. and the higher interest rates are going to benefit the financial service companies. >> that could help us. or hurt some. but it's still so low it shouldn't be hurting anyone that much at this point. if we stay below 5%, our whole life it's been between 5% and 10%, right? >> and over the history of the fed, a normalized fed funds rate is around 5%. i mean, we're thinking that we get to 1% give or take by the end of next year. we're still thinking two hikes. >> and it used to be 90 cents right? >> dollar/euro may go to parity

here. >> right. didn't it come out at 90? and then they said we're going to make this european union, it's really going to work. we're going have the same currency. it's going to be huge. it's going to work and have no problems. bureaucrats in belgium tell everyone what they can and can't do. >> last quick question. the year of the small caps? theoretically if they're more insulated from higher dollar, maybe take a higher hit on interest rates but benefit more from corporate tax reform. >> it'll be small cap. it'll be value within value. it's going to be the financials and energy. financials have been suppressed for so long that now that they're out of the gate, they're like roman candles. they're just going to go straight up. nobody was positioned to be in them. so the leadership will come from the financials. >> yield curve and no do

dodd/frank. could be gone. all right. thank you. >> thanks. merry christmas. >> where are you going? are you going anywhere? >> no. we're around. we're hosting christmas day. >> you want to host here? >> i'm not working next week. tomorrow is my last day. >> all right. that sounds so final. but you'll back next year. >> i'll be back next year. absolutely. i think so. i think so. >> we always say final words from our guest host. scary. happy holidays, merry christmas. >> merry christmas. coming up with just three days before christmas, is it too late to order online and have your gift arrive on time? a look at how companies are getting creative in order to have your presents get to their final destination. that's straight ahead. and later their hearts are just as warm as their hats. we speak to the cofounder of love your melon. their business is booming and it's for a good reason. take a look at yesterday's top dow gainers.

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

generosity is its oyou can handle being a mom for half an hour. i'm in all the way. is that understood? i don't know what she's up to, but it's not good. can't the world be my noodles and butter? get your mind out of the gutter. mornings are for coffee and contemplation. that was a really profound observation. you got a mean case of the detox blues. don't start a war you know you're going to lose. finally you can now find all of netflix in the same place as all your other entertainment. on xfinity x1. ♪ it's just three days until christmas. panicked yet? you should be able to order

online for last-minute shopping from any retailer these days not just amazon right? which retailers can get you gifts today? courtney reagan is still working on her list and joins us from an amazon warehouse in new york city. morning, courtney. >> reporter: hi, kayla nap is very true. stores have been the answer for somebody like me who waits. but amazon prime now offers two-hour delivery. that of course is if you live in one of the 30 cities where it's offered and you pay that $99 annual membership fee. so yesterday in new york city, i actually used amazon prime now to start to fulfill the list from a charity wish list i got. now, the selection is more limited than the full site but i was able to get almost everything from cook ware to tools. i placed the order just before 2:00 p.m. and we had a camera at the facility to catch the order being fulfilled which happened

in eight minutes. now, the earliest free delivery window was 4:00 to 6:00 p.m. while i wrapped over gifts, the delivery person left the facility around 2:45 p.m. and jumped on the subway with our items and came to deliver them just about 3:10 p.m. so say 50 minutes earlier than the window and just about 90 minutes after i ordered. he scanned the items and off he went with the big orange backpack. many retailers are using modern day couriers for the last mile delivery. and shipping from their stores, target uses instacart. and walmart is still trying out grocery delivery but we haven't heard on the progress. i did also try to fulfill the charity wish lists using google shopping express as well as macy's. but neither one were able to get me those items on the same day. back to you. >> thank you, courtney. i feel like these things,

though, are doing real disturbance to people. because it's enabling people to procrastinate and not get their work done. >> although this year you have an extra saturday. you have a supersaturday. >> i think you thought about this. >> oh, i'm done with all mine. >> me too. joe doesn't buy presents. >> i do. i buy one. >> the most important one of the year. >> buy one. you know how that works. happy wife. >> happy life. >> that's it. coming up, our trading block is here to get you ready for the trading day ahead. a look at oil. also millions of travelers will take to the roads and skies in the coming days. what to expect. that's next as well.

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with predictive analytics... helping them proactively protect the things that matter most. get ready. because we're helping leading companies lead with digital. if you're getting ready to travel for the holidays, you might want to pack some patience. it's projected to be a record year for the number of americans heading out of town for the holidays. the nation's largest travel club aaa says nearly 11 million americans are expected to travel for the holiday weekend. people in the left lane with no

one in the right lane at all just driving below the speed limit in the left like i have chosen this lane because i like it. i know lanes are optional and this left lane is the one i happen to want to drive my buick in at 45 miles an hour. why are you honking? >> i think we need to update that vintage footage. >> 93 million are driving. fueling those road trips. and you won't find relief in the crowded skies. either aaa says the number of fliers will be up 2.5%. it includes little babies and newborns for andrew over the last year. so where are people going this week? some place warm mostly. that will be the whole planet eventually. aaa's travel agency says vegas, orlando, new york, san diego, and anaheim are the top five spots being booked right now. apparently there's a tourist attraction in anaheim.

>> big one. >> orlando too. >> but not as big as the other one. >> and universal studios. why go to anaheim? >> actually if you're in anaheim drive a little north and go to universal studios. and if you're stuck in an airport, you may want to try downloading super mario game. mario run has set a download record topping 40 million in just four days. but there's a catch for unlocking the entire game. and that is proving to be a potential problem for the company. nintendo shares are dropping in worry because gamers are balking at the one-time cost of unlocking content. the first few levels are free, but then to unlock the rest you have to pay $9.99. the stock is now down 16% since the game's launch last thursday. it was a big deal that this was going to be available on the iphone 7. that was supposed to be the big boost for nintendo. but maybe the business model is flawed.

coming up, a check on some key market metrics ahead of the holidays. then it went from being an entrepreneurship class in college to a brand to battle childhood cancer. we'll talk to the cofounder of love your melon about their budding start-up. into the break let's look at the futures. dow looking ining to open 11 po lower stay tuned. ♪ ♪ is it a force of nature? or a sales event? the season of audi sales event is here. audi will cover your first month's lease payment on select models during the season of audi sales event.

among our stories front and center this morning, president-elect donald trump has named kellyanne conway as counselor to the president. conway has served as a senior member of the trump transition team. about 6.4 million americans signed up for coverage for the affordable care act. that doesn't include automatic renewals and it comes amid double digit premium increases for many.

a new study by trulia says about 40% of young americans were living with their parents or other relatives in 2015. that's the largest percentage since 1940. of course the year after the great depression ended. that trend has been steadily rising for the past decade. 2005, for instance, only about one out of three lived with family members. one guy on twitter said at least my daughter who is 23 has a full-time job and is paying me rent. not a bad thing. >> how does that compare to some countries in europe? like what's italy? you hear about all the italian guys that are living with mom. >> and they might live there with their spouses. >> some of that stuff is cultural. you sort of live with your parents until you get married and you buy a house or they buy you a house with your significant other. it's not necessarily all apples to apples. >> doesn't seem like a great thing here. seems like it's a reflection of how tough it is when you're starting out nowadays. >> student debt is a huge thing,

right? economic woes. but it will be different in 2017. >> you're on your smartphone all day long, can't go looking for a job. >> playing super mario or whatever. pokemon go. >> facebook, instagraming selfies. snapping. how can i go for a job interview? i'm snapping. >> so busy. let's take a look at the oil and currency markets and bring in managing director of bk asset management. also managing director of clear view energy directors. institutional services. kathy, i'll start off with you. we're all watching dow 20,000. is the equivalent euro/dollar parity? >> i think it's along 120 dollar/yen. i think this reminds me of what was happening in 2015 this time last year where the u.s. dollar

was very, very strong. and everyone thought next year was going to be a continuation of the u.s. dollar. the start of the year with the massive crash as a result of china. so this is a crowded trade right now. >> 20,000 long dollar is a bit crowded. so i would not rule out the possibility of a correction. especially since january. we do see a lot of volatility. that could be something that rocks the market. we don't necessarily see the good data that's usually followed up with, you know, with the consequences of a stronger dollar. >> jacques, i would imagine that's good for the markets to hear the dollar strength could be capped? >> i think with the oil markets what's really needed is a history lesson on opec. there's three steps to it. opec promises to reduce production and they talk about it and oil prices go up. step two, they continue to talk about it and oil prices go up. step three is they underdeliver. that's where we're headed now as

we're starting to see points of supply rising in places like libya that can cause oil prices to go down. >> so what is -- what happens to oil immediately? when do we see that third phase really kick in? >> you're really going to need to see a lot of data points. i mean, what we're seeing -- opec is saying in non-opec countries is we'll start cutting production in january 2017. so we're not quite there yet. but we'll start to see the data points roll in. then what's going to happen is it's going to come down to the opec meeting in 2017. >> iuorio, what's going on with the vix and future vix in particular? i mean, yesterday we saw it hit its lowest level since august 2015. it was ten and change. that's shocking. what are we anticipating further out in the curve? >> yeah. the vix is telling us an interesting story. remember the shortest vix is what is getting ground into the dust. what the vix is telling us is that the next couple weeks

there's nothing really exciting. now, the interesting thing that you mentioned is contracts, the second contract, they're low. but not low by any means. so they're telling us after things start to happen, things could be a little interesting. >> that's what you see in the currency market as well, kathy? >> perhaps a little sooner. generally brings us significant volatility. it depends upon the presidency and how quickly they come out blazing with the stimulus package. i think in the start of the year there could be some profit taking. i think the dollar is still going to 120 against the yen. you've got ton of elections in europe next year. we could get close to parity in the euro/dollar especially if the elections don't go favorably. there's a lot of risk next year. but what i'm worried about is those earnings. you always see earnings miss as

a result. regardless how many times this happens. i think that could really start to pull back stocks. and if we have a pullback in stocks -- >> the dollar strength though, when the dollar was strong the second half of 2014, it was because we were the victim of the ecb and the boj. our policy was irrelevant at the time. they were so incredibly dovish. right now we're moving higher because of domestic story because of a regulatory environment and tax environment. don't you think that matters? don't you think the stock market overall can withstand a stronger dollar if it's stronger because of the domestic story? >> well, it's only if the domestic story pans out the way that is promised. we may not, we won't get a lot of that stimulus until half year at the earliest. it's going to be more pain than gain. you're going to basically see this translate. we're already seeing them reporting lower currency

translations. so i think that perhaps you're right for the second half of the year, but we still have six months to go before we get a real boost in my opinion. >> it's interesting you mentioned iuorio we're the victim of central bank policy around the world. in effect we're also sort of a victim of the weaker outlook for the -- if we take a look at the outflows, we've seen the largest amount of outflows from the you're row zone last year. that's impacting the stronger dollar trade. >> there's so much going on. you have the race to the u.s. that's going to hurt growth. the stronger dollar is going to hurt growth. weaker global growth that could affect the u.s. and any inkling of the need to pull money from the u.s. for whatever reason. chinese collapse, the beginning of 2016 was complete surprise. >> right. >> so there could be something that repeats this year. >> iuorio you want to say something? >> i was going the say the weakness in europe which is ongoing, announced the bailout

which i wanted to say that name. but the quasi bailout of that that shows they continue to push the kick the can down the road. that to me was 90 to 100. can it eclipse. i don't think so. when it gets that high, i agree the fed might start talking about not being quite as hawkish to counteract those. >> when did you move out, jimmy, from mom? >> it's funny that you mention it. >> 35? >> no. but when i was a kid, listen. i'm still in the basement. but i grew up in a multi-family household where the grandpa was the pate ree yark, he was off the boat. but it was more cultural. italian families did that. on our block there were like five italian immigrant families. it was because of economic reasons as well. but it was certainly -- i have a

daughter who has a full-time job and i'm deciding whether or not to charge her rent. maybe you can help on that. >> does she know that or she knows that now? >> she knows it now. are you kidding? she's 21. she's not up this early. >> thanks, guys. >> little jimmy. all right. some politics news. president-elect donald trump meeting with defense company ceos yesterday at his mar-a-lago report in florida. the ceos including boeing's and lockheed martin's. trump tweeted about the high cost of the f-35 fighter jet program. of course that was lockheed's. and the contract to build replacement air force one aircraft and that was boeing's. trump extracted a pledge from the ceo of boeing to keep the cost below $4 billion. >> we're going to get it done for less than that. and we're committed to working together to make sure that

happens. and i was able to give the president-elect my personal commitment on behalf of the boeing company. this is a bis that's important to us. we work on air force one because it's important to our country. we're going to make sure he gets the best ability. >> once the requirements for the presidential plane is set, production is ready to start. when trump was asked whether he had secured concessions from lockheed martin on the f-35 programs, he said it was too soon to know. when we return, millennials start up love your melon has given more than $1.5 million to -- this is good news -- to fight against childhood cancer. donating over 80,000 hats to children suffering from the disease. do you know it yet? >> i don't. >> and this holiday season sales at the company are booming. we're going to find out all about it and the good works the company is doing. we're going to speak to the cofounder about the cause and their products as well after the

break. check out the futures at this hour. they are down a little. meh. that's a millennial word, isn't it? >> totally.

the nbc universal family is celebrating acts of kindness with the annual share kindness campaign. inspiring others to give back this holiday season. today we're talking about a millennial start-up that's committed to paying it forward. love your melon is an apparel company that makes hats, beanies, and scarves and gives 50% of its net profit to organizations dedicated to finding a cure for pediatric cancer. to date the brand has donated more than $1.5 million to fund cancer research initiatives and family support. let's bring in the cofounder and ceo of love your melon zachary quinn. what an amazing idea. tell us how you came up with it and got it off the ground. >> thank you so much for having me on this show. we started love your melon as a class project as a sophomore in college. that year we generated funds to

give a hat to every child battling cancer in america over the next few years. now this year we just set to hit $21 million in revenue. we're donating 50% of our proceeds to non-profit organizations in the fight against pediatric cancer. to clarify, 50% of net profit goes to our non-profit partners in the fight against pediatric cancer. >> so at what point did you know that you were onto something. and what do you think it was about your company with so many charities, with so many businesses trying to do good as they're trying to do well financially. what was it about love your melon that made people want to get behind your cause? >> it was the first 200 hats we sold. we knew we had something big. we had to start a business class project. and we were competing against other class projects in our sophomore year of college. we set up a table outside of my parents' restaurant. they're both entrepreneurs. and we started talking to complete strangers about this project we were doing to give

away beanies to kids who lost their hair to cancer treatment. everybody lit up about it. we sold out in two days when the teacher didn't think we could do it in a full semester. i dropped out of college and have been running it ever since. >> not many class projects end up with $21 million in revenue. or in sales. >> well, we've had some great partnerships this year with shopify plus, facebook and instagram were one of the top advertisers. and what i attribute it to is authenticity. we create content every week whether it's in children's hospitals giving away beanies or with our non-profit partners in the research labs or simply going out and getting people to wear our beanies when they're skiing and snow boarding. we do three to four photoshoo ts a week. that leads to attributing sales and directly focuses people to our website. >> and you focus on direct to consumer. the internet is sort of your life blood at this point.

how important is social media in getting the word out and could a company like yours exist and donate $1.5 million to date to cancer research if it were not for social media? >> so far we've given $1.5 million away. by the end of the year we're giving away over $2.5 million to our non-profit partners. and it is a millennial generation has come up with this beautiful thing called social media. and being able to use it, we wouldn't be able to exist otherwise. because we're sharing immediate organic content, things that are actually happening in the moment with things like facebook live and other tools like instagram stories and sharing those pieces with people. shows that it's really happening, and it's happening in the moment. and people then want to go purchase our products. our apparel products from beanies to outer wear. all across the country. >> where else could you see the company expanding to? as the name implies, you started with hats.

but what's the limit? >> i think we've got a lot of work to do. i think we could do at least $50 million to $60 million in revenue next year. that's going b to come from future partnerships. we're looking for a retail partner right now to launch in stores in 2017. and also looking to do cobranding projects. we were just on cheddar tv and those guys are asking me to make beanies for them. i think we've got to make a cnbc hat too. where we have all the profits -- half of the profits still going back to pediatric cancer. but having this creative momentum that we've generated and creating awesome products for other companies all across america. >> well, you're in the right place on cnbc to look for a retail and a co-branding partner with all of our corporate viewership. you're based in minneapolis. you went to college in minneapolis. you think people in the midwest are just nicer? do you think that helped you? >> actually, our fastest growing market is in the northeast. it just surpassed the midwest.

and then we're going to be turning to the west coast. because what we created with love your melon originally is we didn't go after a market purchasing beanies already. we went after a market of individuals that weren't wearing beanies and decided to show them an attractive product they could wear to work, in the classroom, and other places. so now that we've tackled that new market, gotten these people interested in it, we're going to be heading out to the ski hills, to skateboard parks in l.a. and selling beanies to people there and taking over market share in those places. >> well, we wish you all the best, zach. and it's going to be a busy season for you. and best of luck with a great cause. >> i'll send you guys some beanies to stay warm this winter. definitely cold in minnesota so we've got to stay warm. >> it's cold in new york too. zachary quinn, happy holidays. good to see you. >> thank you. >> a millennial doing good, joe. >> millennials didn't really invent it but use it.

zuk zuckerberg is a millennial. people are happier when they get off of social media. kelly evans is happy now. with some stocks you want to watch at the opening bell of trading on wall street, let's check the futures at this hour. still indicated slightly lower. also watching currencies at this hour. not a whole lot of movement. 117 and change on the yen. "squawk box" will be right back. generosity is its own form of power.

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let's take a look at a couple of stocks to watch this morning. red hat is under pressure this morning. quarterly profits did beat estimates. also announced the impending departure of chief financial officer in late january. down almost 12%. bed bath & beyond fell 13 cents short of estimates. the home goods retailer also forecasts full year earnings that will now be at the lower end of the prior forecast as customer traffic has declined. and yum brands declared its first dividends of the china business. in other tech news, the u.s. is returning taobao to its blacklist of notorious market places. this move against the alibaba

online shopping site follows complaints from u.s. and international trade groups. the groups argue taobao wasn't doing enough to stop fake sales. the levels of counterfeiting and piracy were unacceptbly high and posed a, quote, great economic threat. new details on a hacking group linked to the russian government in the cyber attacks against democrats during the u.s. presidential election. cyber security firm crowd strike said the group known as fancy bear used a malware device to target between 2014 and this year. the intelligence gained from the malware was likely used by pro-russian separatists to strike against the u cranians. used in ukraine is to the kind used in the dnc. bad news for eggnog lovers. the u.s. is facing a major

shortage of the holiday drink this year. record eggnog sales led to major shortages all because the producers underestimated the high demand. i thought you were supposed to make your own. eggnog sales up 60% over last year compared with 5% increases in recent years. that's tough. >> it just looks like a heart attack in a carton to me. >> that's not alcoholic there. it's usually alcoholic. >> you add your own i would imagine. >> it looks like egg beaters. it looks uncooked. >> right. or you would make pancakes out of it. still to come on "squawk box," the road to 20,000. straight ahead. plus mohamed el-erian joins us to talk the fed, economy, and more. and at -- "squawk box" will be right back. (fans cheering)

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breaking news. three key economic reports out this hour. could the data push the dow to 20,000? the trump transition. the president-elect tapping a few familiar faces to cnbc viewers for key roles in his administration. plus business in the cloud and the battle for innovation. will tech wow or whiff in 2017? we'll open up cnbc's tech playbook as the final hour of "squawk box" begins right now. live from the most powerful city in the world, new york, this is "squawk box." >> welcome back to "squawk box" here on cnbc. i'm joe kernen along with melissa lee and kayla tausche. the futures have been -- there it is. that's basically it. that's what we've been looking

at most of the morning. slight drift lower. a lot of people already probably enjoying holiday break, you would think. there's the 10-year now. 2.55%. not a whole lot of movement in currencies either. somewhere around 1.04 on the euro. 117 and change on the yen. three big economic reports due in the next 30 minutes. weekly jobless claims, durable goods, and a final read on third quarter gdp. in corporate news, another wild trading session for the world's oldest bank. shares of italy's monte de dei paschi trading was halted. now a real estate bailout is expected without any force on to bondholders which you never like

to see. kellyanne conway has been announced as counselor to the president. stocks to watch this morning, a mixed quarter for conagra brands. revenues missed forecast amid an overall slide in sales. company blaming itself effort to build a higher quality base. company calls its performance solid amid a difficult performance by the extended process to be built by walgreens boots alliance. and nike habs added to best idea at guggenheim. that market expansion should take place in 2017. hershey we're watching that one as well naming new president and ceo buck has overseen hershey's expansion into other snacks. hershey rejected a takeover offer from mondelez in august.

and micron beat demands. expecting second quarter earnings to come up well above expectations. that stock is rocketing higher by 12.5%. shares of actelion surging. it is now in exclusive discussions. reports say the deal could be worth $30 billion. >> mike rcron is unbelievable. >> it is. >> it's so volatile. >> for a commodity business. >> over the years watching that thing, wow. strap yourself in. >> and now coming back apparently. now back to the markets. joining us for the forecast for what's ahead, joe seidel is richard bernstein portfolio strategi strategist. ed campbell. we got gdp coming out revised or whatever and durable goods. even when there isn't a new president, we look at these sort of rearview mirror type numbers.

so are they even less relevant for -- you know, when they come out today, any reason to even talk about them considering that we've got a new president and are looking ahead and wondering what's going to happen? >> well, any new news is new news and its will impact the market. i think if we get good data today, we should reach it. >> and your thesis is that the deceleration that we've seen, the sluggish economic growth that we've been used to for years and years now that we're finally going to break out of it. >> we think trumponomics is a game changer and could break the economy out of the lower for longer rut it's been in post-financial crisis. so we think we will get better growth next year. although it does raise the risks for future years. and that it may be too successful at stimulating the economy. i mean, to go back to a time where we've had such significant

fiscal stimulus this late in an economic cycle where it's close to full employment, you need to go back. but the risk is that it does spark some growth that is above trend. and reawakens animal spirits and inflation and we get an aggressive fed. and that leads to a sharper downturn two to three years from now. but for now let's enjoy the party before we worry about the cleanup. >> so part of what ed just described and that is the economic backdrop has resulted in an earnings trough that we recently saw. so that any multiples that we look at, the "e" is depressed so everything looks expensive. but maybe multiples you don't look at valuations as being expensive now since it's reflecting an earnings trough. >> exactly. your point just a second ago was about how with gdp data and other economic data is like people looking in the rearview

mirror. people who were criticizing this market is doing the same thing. looking in the rearview mirror and the point is the markets will always look expensive when your earnings are troughing. always going to look the most expensive. so here we're looking at sort of first and second quarter eps growth where, you know, by the end of the second quarter we could easily hit 20 to 30% on a year over year basis. >> if you just had not the actual price, if you look at the nominal one and use the numbers, it's probably expensive. what do you think it really is? >> real for -- >> what's it feel like? the realistic price earnings multiple given the earnings power? >> with interest rates still being relatively low, the pes ought to be higher than normal.

simply because, you know, it's still obnoxiously cheap to go out there and borrow. they got another hike off, you know, this past here in december. they might get two to three in 2017. so, you know, with interest rates still being low, the valuations ought to be higher. so, you know, do you go back to something we all learn in finance 101 or econ 101. with your rate and pe ought to equal 22 or 23. i think that's probably a pretty good rule of thumb. >> you can remember? >> no. >> to the point, the e could get even bigger if we have more corporate tax reform. people don't have that in their models at all for 2017. at this point the shift in sentiment is so striking. i'm in that boat too. that things have changed.

there is a change here that will happen. but what is the thing that we're not thinking about at this point? consensus is now that things have changed. >> yeah. >> and that is frightening. >> it's maybe what we and joe were talking about before we came onto the segment. the darker side of the trump agenda for financial markets is the anti-globalization rhetoric we've been hearing out of the president-elect. certainly the news we've heard this morning that they're floating 5% across the board tariffs on imports, that's something that does not give me the warm and fuzzies. and, you know, i hope that's just talk and that's not something that's likely to result in real policies. but if that were to happen, if we were to go down that path, that's the case. and we're talking about a risk scenario. >> you have congress getting sworn in on january 3rd. they have two weeks in office, they're an extremely productive

bunch. they have two weeks before the inauguration. what do you expect to see from congress which will be tasked with writing policy before the president even gets one in? >> i don't expect to see much from this lame duck congress. especially with president obama still being president until the inauguration. but, you know -- >> would you look for any positive signs of progress? where the needle is getting moved on perhaps the gop's better way tax plan. pencils back on paper. >> i don't expect much of in ig. do you? >> we don't see anything -- >> wow. high bar. >> exactly. we know from experience that we don't want to set that bar too high. especially from, you know, from congress. i think our perspective is we can see two to three quarters' worth of growth before we need any additional kickers from congress or anything else. >> that takes us to the second half of 2017. >> before we need any additional

help. one of the drivers here is energy and oil prices. if you think about it, the first quarter, oil was still in the midst of a 60% to 70% decline. and it troughed in february of this year. $25, $26 a barrel. so if we go into -- if we average $50 a barrel of oil in the first quarter, then we're talking about energy being a huge contributor to earnings because energy prices will be up 100% year over year. so a lot of the comps in our year over year forecasts end up being pretty easy at least for the next two to three quarters. >> all right, ed, thanks. joe, thanks. >> thank you. >> so did you see -- you work with bernstein, right? is he in today? >> no. >> right. but not all week. >> out next week? >> yeah. the worker bees are here. >> is he here monday? >> he was in monday. >> tuesday? >> tuesday. >> now you're lying. >> no, no. he said -- >> when was his first day off?

wednesday? >> wednesday, yeah. >> see. it's richard bernstein company. >> sends the other guys out there. >> joe zidle the brains of the operation. >> i'll be in. >> you're in tomorrow? >> i'm on vacation tomorrow. i'm in next week. >> while bernstein is -- >> turning on the lights. making sure our tvs are tuned to cnbc. >> bernstein is somewhere on a beach, isn't he? >> or the ski slopes. >> i knew it. >> all right. thanks, guys. coming up on "squawk," a check on the tech cnbc playbook and get predictions for companies like google and apple ahead. plus a deluge of economic reports on the agenda today. we'll bring you the numbers and the market reaction. and later, less than one month until president-elect trump takes office. we'll talk trumponomics with representatives gregory meeks and sean duffy. "squawk" will be right back.

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welcome back to "squawk box." in corporate news, petroleum is striking a deal to sell natural gas fields and pipelines that they own in pennsylvania. they're selling them for $1.2 billion. a buyer is a unit of houston

based energy company alta resources. meanwhile, yum brands is declaring its first dividends. it will pay a dividends of 30 cents a share. this is important. stay tuned and listen very closely and write this down. it will be distributed february 3rd. to shareholders. and you have to be a holder of record as of january 13th. >> mark it in your calendar. february 3rd. >> if someone sees the news -- >> payday. >> what's the yield i would like to know. i don't care about those details. when do the proxy forms get sent out to see whether you want to vote on a different -- no, go ahead. >> usually before the first quarter. >> that was rhetorical. 2016 has been a wild year for the nasdaq and technology. so what trends do you need to be watching next year? josh lipton opens his 2017 playbook for the tech sector.

>> reporter: the nasdaq surged to new highs this year and 2017 promises more fireworks with dynamic gadgets and services and the ongoing cloud wars. first google's head is in the cloud. the search giant controls just 5% of the cloud infrastructure market. in 2017 google will double that putting pressure on industry leaders like amazon and microsoft. second, trump doesn't scare cook. on the campaign trail, donald trump went after apple for manufacturing overseas. saying he wants apple to bring iphone production home to the u.s. that's not going to happen. the economics of bringing large scale low skill assembly line work back here don't make sense. tim cook will counter that he already directly employs some 80,000 people. third, that tech ipo pipeline

heats up for the enterprise. snap will make its public debut next year. but it's the smaller enterprise focus start-ups that will dominate the ipo market in 2017. okta, mulesoft, and dynamic will go public. they want to see the vendors before opening up their wall lets. now, i know a lot of our viewers want to hear about the ubers and the airbnbs but these are companies that seem to have continued almost limited access to private capital. so it's the smaller private enterprise name that you get to own in 2017 guys. >> thanks so much, josh lipton, out west. for more on tech and the year ahead, josh is going to stick around. but let's also bring in christopher mims who recently wrote a piece titled "why 2016 was a water shed year for tech."

water shed in what way? >> in five of the seven most valuable companies in the world right now are all technology companies. the top three are technology companies. and that value has brought with it more scrutiny from the public and various governments including my own. >> is that because their core businesses are getting that much bigger and more monopolistic or because they're diversifying and touching more sectors? >> it's definitely both. i think facebook is fast becoming what i would call the standard of media. then you have companies like amazon which are pushing into just a breathtaking array of businesses. who would have thought the same company could be dominant in cloud and nominated for an oscar as their media wing was this year. >> but these companies still act like they're underdogs and they

expect to be treated like underdogs. we saw that doesn't necessarily play out that well. >> i do think sometimes it's funny reporting on these companies they have a persecution come flex. they're different from banks and bankers who are used to getting bullied by the press one morning and having martinis with them the next night. they do act like we're the innovators and why would anyone criticize what we're doing. i do give points to facebook recently for responding admirably to the fake and distorted news controversy. they're just starting to admit that they're a sort of media company. >> how do you think tech gets treated under the new mvgs? because for so many companies the changeover in washington is going to be the most closely watched item on their calendar. >> that's very unclear. because i think before the big

tech summit with trump at trump tower and tim cook and a litany of other tech ceos, looked like there was a lot of attention and personal attacks by president-elect trump on various tech company ceos, now they pledged to work together. it's possible that even seemingly mortal foes of trump's agenda like elon musk might be consulting with him through his peter thiel. it's not clear which direction that's going to go. i would be wary of anyone who wants to make predictions on that. >> it's interesting if you really hone in on the stock performance after the election of the likes of a facebook or amazon, they're actually lower. you had mentioned elon musk. tesla is higher. the day the ceo met with donald trump the stock started moving higher. it's going to be treacherous, right? what are some of the big issues, chris, that the tech industry

will be watching and really pushing in terms of their agenda with the trump administration? >> obviously the two are directly at odds on immigration. the tech sector has long pushed for more high skilled immigration. another issue is of course subsidies for clean energy and clean tech i think in california when you add in the federal subsidies you get more than $8,000 in subsidy on your vehicle. and globalization is of course the biggest elephant in the room. if we get into any kind of trade war with china, that's going to be extremely problematic for companies that rely on china to manufacture their hardware. >> quickly before we go, chris, any predictions for one winner, one loser to come in 2017. >> i think amazon is going to continue to win. in terms of losers, i think that

apple if they continue to underperform their record quarters of the previous year could take a beating. >> all right. we'll leave it there. christopher mims columnist at "the wall street journal," we appreciate it. >> thank you. coming up, game on. forget super mario, we'll tell you how millennials are driving the board game boom. it's coming back. that story is next when "squawk box" returns.

welcome back to "squawk box." let's take a look at futures right now. and we've been sort of -- look. we popped into the positive in the dow jones industrial average. so we're up seven points now. closer to dow 20,000. today could be the day. s&p is looking to open a little bit flat here. nasdaq as well. let's look at the dollar index. i should say the dollar trade across the board. pretty much flat trade here going into this thursday session. making headlines this morning, berkshire partners acquiring a significant majority stake in kendra scott design. the texas based jewelry company is valued at more than $1 billion. sources say the deal will keep kendra scott as majority owner of the business despite being priced under a hundred bucks, scott's jewelry has been worn by sophia vergara and mindy kaling and has been on the runway by the likes of oscar de la renta.

board games are mainstream again as young adults look for a way to socialize with their friends. global sales of games and puzzles hit -- >> they have to get out of the basement. they have to get out of the basement and board games are the reason. >> do you think they do it in discreet and watch on a conference call? do they actually leave and go be with people? >> you mean like facetime? they facetime board games? >> you have to shower and dress to go out and be with people. >> you don't have to. >> it depends what people you want to be with. >> board games hit $9.6 billion this year up from $9.3 billion in 2013. according to market research firm euro monitor international. year on year growth is expected to be 1%. led to the creation of cafes and bars that are focused on traditional games. 30% of millennials now say they are interested in -- >> because they want

experiences. >> right. >> they want experiences. that's it. see, you need to translate and help me with these things. >> feel free to ask any questions to understand. >> do you think monopoly people or life people? what about risk? what about scrabble? >> maybe. >> what about stratego? >> i don't know what that is. >> is that the battleship one? >> no. but what about battleship? it's not stategery. >> risk is always cool. >> chess is always a good one. >> it's hard. it's hard. >> maybe not at a bar. >> it's an acquired skill. >> too much thinking. 3d chess is worse. coming up, breaking economic news. we'll bring you the numbers and

the reaction next. let's take a look at the treasury yields this morning. cracked 2.55% here on the 10-year note. as well as look at oil prices. and slightly lower trade on brent as well as wti. you're watching "squawk box" here on cnbc. s my headquarters. this is where i trade and manage my portfolio. since i added futures, i have access to the oil markets and gold markets. okay. i'm plugged into equities- trade confirmed- and i have global access 24/7. meaning i can do what i need to do, then i can focus on what i want to do. visit learnfuturestoday.com to see what adding futures can do for you. the market.redict but through good times and bad... ...at t. rowe price... ...we've helped our investors stay confident for over 75 years. call us or your advisor. t. rowe price.

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we are just seconds away from initial jobless claims, durable goods, and the final revision of third quarter gdp. the futures have turned positive. rick, what are these numbers? >> all right. third time around the block on third quarter gdp. up 3.5% so we enhanced it by 0.3%. that's even a couple of tenths better than expected. and if we go back in time, that would be the best quarter since the third quarter of 2014. which then was followed up by a string of two handles. if we look at the price index, 1.4% as expected. same as last look. consumption picked up 0.2% from 2.8 prths to 3%. durable goods, preliminary. it's minus 4.6%.

that is in line or darn close to expectations. and it's the mirror image of our last look up 4.6%. but that increased 0.2%. this is preliminary but it is a miss. however, when you strip out transportation, it goes up. it goes up to 0.5%. now, granted, 0.5% isn't the same as our last look which was upgraded to 0.9%. but it's twice the expectations of up 0.2%. nondefense orders, exaircraft a proxy for capital spending. also was up better than expected. it was up 0.9%. but we could do better. and 0.2% on orders claims 275,000. that's quite a jump from 254,000. a bit unexpected in continuing claims. moves from 2.02 and change. to summarize, gdp no surprises.

but it is a baseline. it is a little bit better. the real reads on preliminary, a little bit weak. and of course 20,000 watch looks like it's going to be interesting again today. dollar index unchanged. rates in the mid-250s. but darn close to the highest closing levels since september of 2014. kayla, it's all yours. >> all right. thanks so much, rick, for breaking that down for us. steve leisman is here also. with a bit of a closer read. what do you think? >> good number on the third quarter gdp. unfortunately it's not being followed up immediately in it here. we had a good october and november number. november date has been squirrely. it's something to watch for the month. not as good as if we were down at the 250 level. looking at two numbers here which is the nondefense business investment up 0.9%. that's a good number.

we'll see if some of the new policies from the president-elect might spur that. we use that word animal spirit quite a bit here. but good data could lead to better investment. finally the other thing i'm looking at is the corporate profit revision here. it was up -- let's see what the number is here. it's been revised upward to 6.7%. so there has been in the overall economy a turnaround in corporate profits. and i understand we're in a hurry to get some place. going to cut it off right there. >> thanks, steve. president-elect trump as we've been talking with a couple of appointments today, but one is announcing that kellyanne conway will serve as presidential counselor. she joins us now from trump tower. it's always great to see you turn down press secretary. i laugh at that. who in their right mind would want to face the press corps in this administration? seeing what we've seen for the past year or so. i think you were smart not to do

that. you got any takers? >> absolutely. many qualified men and women have put in for press secretary. and i believe that announcement will come soon, joe, as well. that individual will do a fabulous job and i'm there to support the press secretary and the communications team as well from the west wing. i'm sure that will be part of my portfolio. >> i saw that you likened is the to valerie jarrett's role. i see her was one of the most powerful people for the past eight years. almost a concierge for president obama. if you're likening your role to that, it will be an influential and powerful role. >> ultimately for me it's about impact. and that's just in service. i just -- the reason somebody asked me, you know, help our viewers here. whose role would be similar. they mentioned valerie jarrett to me. i think what's most important is what your role ends up being for that particular president. and i'm there to serve president

trump however he sees best. much more than the glory and the prestige. you've got to have impact. that's why it took me awhile to understand where i could help him best. i think outside the political structure is an important operation in terms of defending against what you just mentioned, joe. which is a somewhat hostile press in some ways. but also ridiculous skeptics who refuse to even let him form his government and start pushing through his legislation. this man won. he's the president. he's a master communicator and master connector with people. he's brilliant. obviously successful man and thinker. businessman and thinker. to help achieve the legislative goals. it's like any other workplace. you have to enjoy the people you work with to be effective. i have enormous respect for the senior team that's in place. look forward to working with them. >> we know a lot of the cabinet

already on this show. very familiar with pete navarro for example and others. now va potentially toby cosgrove. he runs a pretty tight ship at the cleveland clinic. does that make sense? i heard that president-elect trump was impressed with him. >> toby cosgrove is incredibly impressive. i know they had a fabulous meeting in palm beach where the president-elect is working nonstop. there are other people who are in the mix for va. it's an important appointment for the president-elect. but he has made this such a center piece of his campaign in the middle of his presidency where he's way out there saying who are we as a nation if we can't take care of our veterans. and who are we if we're allowing them to die waiting for care in the va hospitals. we just can't have it. it's flabbergasting. and he won't accept it as

president of the united states. it's an important position. we're down to va and secretary of agricultural. i worked on a blueberry farm for eight summers. our short lists for each of those have lengthened. because the president-elect continues to meet with qualified men and women who do a great job. they're just very different. he will make that ultimate decision, i expect those to come soon. >> after the horrific traj -- not even a tragedy, it's a terrorist attack is what it was in berlin. the president-elect said once again i've been warning about things like this and now you understand why some of the steps i79 to take. some people went back to a total ban on muslims. but i assume what he meant and maybe you can clarify, i assume what he meant was extreme vetting of people who want to come here from areas of the world where we've seen wherever it seems like something like

this might be more likely to come from. those are the areas you would get the extreme vetting. is that what he meant? >> yes, that is correct. he has talked about that on the campaign trail. you're against hillary clinton who won't even call them radical terrorists. i think many americans appreciate the fact he'll at least start there and then just try to join with our allies. and even those that we don't work with that closely on other matters to come together and defeat radical islamic terrorism. he wants to have more extreme vetting in place in the country in places that harbor and train and e poxport terrorists. this is simple to understand. you go where the hot spots are. you go where the training is. you go where people are looking to bring harm and bring death and destruction onto civilized people in europe and the united states of america. now germany joins france and

italy and belgium in terms of being told this is the new normal. brace yourselves. we don't want to hear it's the new normal. in and around christmas and hanukkah and new years warning people about attacks. or at least being vigilant about it. this is -- how many consecutive years in a row are we dealing with this? you look at the polls and people feel more safe than years ago. >> you know, the president-elect has a very long to do list of things he wants to scrap and change in washington. is immigration reform something that we should see prioritized in the first hundred days? how will you help him prioritize what he wants to start doing? >> if you're donald trump totally doable 100-day plan.

talk about immigration reform specifically. you know, one of his signature center pieces of his campaign was to build the wall, start there that we're a sovereign nation that must have borders and we must protect the american worker. in addition to that. if you look at the immigration piece of his 100-day plan, you will quickly see familiar aspects you heard on the campaign trail. in addition to that, he wants to start the process of deporting these criminals who live among us. people who are here illegally who have committed crimes. he's made it very clear they go. the gangs, the drugs. and he also wants to make sure that in addition to people coming over illegally that we stop the flow of drugs from over the border as well. so that's important to him. he's got the ten-point immigration reform plan. anybody can pull it up and read it. you can agree with it or disagree with it but at least you know what it is. road maps like that end up being

incredibly important to him in this election. so very little has changed in terms of what he said in the campaign trail and what you see in his 100-day plan. >> kellyanne, it's melissa lee. since the president-elect was elected, about $2 trillion has been added to global markets. we're calling it the trump rally. i'm just wondering if the president-elect takes credit for this big move in the stock market. and if the things that are spurring this rally, the hope, for instance, for corporate tax reform and corporate tax cuts specifically, if that is educating how he prioritizes the possible reforms we could see to the economy within that first 100-day plan. >> yes. let me just say first you're right. it's great to call it the trump rally. the $2 trillion addition to the market cap and also the dow rallies that we see many times since he's been elected on november 8th. you've seen the stock market react favorably. by the way, that is counter to

what was immediately and sinisterly predicted would happen. they're quickly and sorely disappointed. the markets seem to like this. they know that there's job production coming. 25 million jobs. they know there's a corporate tax break coming. capital gains coming. he promised them and even george w. bush as president by june had pushed through his tax package. and it was a huge boom to the american taxpayer but also to his presidency. i would point out, too, because it's relevant that president george w. bush was able to push through his tax relief package in june 2001 with the help of many democratic u.s. senators. many of whom were up for re-election. many of these elected officials, these senators, democrats, who are sitting in one of those 25

seats they must defend especially in the ten seats that donald trump just won, i have a feeling that they will make a list and check it twice to find out if they should be supporting this tax package. it's going to be very difficult for them to resist such major investments in the economies, such major job production and most importantly economic growth. you look at everything donald trump has said and you see this is a man who will not settle for any 2.5% growth. >> so are you saying june is a good time frame for us to be looking for actual tax reform to be passed? because that's a very aggressive time frame and that would probably be good news for the markets. >> i think we left them. we lost them. >> is the -- let's see if we can get her back. i'd like to hear the answer to that. >> yeah. most people say the end of this year would be the most likely. >> goldman sachs says 2018. >> right. exactly.

and so if we're talking about -- >> when it will flow through to the bottom line. >> we might go to -- >> we talk about the markets more broadly here. mohamed el-erian former pimco ceo joins us now to talk the markets. great to have you with us. >> thank you. >> in of reforms and taxes, is that the number one thing that needs to happen on the fiscal side in order for these stock market gains to continue? >> this rally is push bid three things. one is as you say economic policies. not just corporate tax reform. infrastructure spending, deregulation. so people expect higher growth and higher earnings. you also have expectation for higher inflation which means you restore pricing power to the corporate sector. and finally money coming from abroad. some of it, not all may go back into the markets. so it's three different aspects.

that's what has pushed us in the rally. >> your commentary is people are taking a look at the dollar strength and the dollar index being close to a 14-year high. as a head wind to corporate profits. you actually say this could lead to protectionism as well down the road. walk us through. >> my major worry is that the u.s. moves on policies. and you know it's never been an engineering issue. it's been a political implementation issue. the u.s. implements but other countries don't move on their policy agenda. and the result of that is that the dollar continues to strengthen which then fuels protectionist tendencies. keep an eye on the dollar. the dollar is going to have a big say as to where the stock market goes in 2017. >> how do you feel about the markets overall, mohammed? >> i think we've established a good foundation in terms of hope for better fundamentals. if we go from hope to design

implementation, but i just caution the u.s. cannot operate in isolation from other countries. and this stock market is going to need help from germany, china, and japan in terms of their policies. >> well, i mean, when you take a look at appointments recently such as peter navarro, are you concerned we won't be getting that help because of the kinds of people the president-elect is putting in these positions that will have direct contact with these hot point -- or hot spot countries you mentioned? >> so two issues. overall, his appointments on the economic front have been encouraging. and these are people you know well. they appear on "squawk" a lot. they understand the functioning of the economy. specifically on trade, let's see what he pursues. i think there's an argument for free and fair trade. you look at tariffs and below the question of currency to standards, to policy makes.

and that is an issue that requires focus. >> okay. thank you, mohammad. >> thank you. >> kellyanne, i think you're back. could it happen by june, because that would be bullish for people? we're talking about tax reform. and hopefully you're back with us. we just lost her again. how does that happen? that's christmas bugs. elves or something. i wanted to hear that. >> i did too. >> i also wanted to ask her for a diagram of the power structure. you've got steve bannon, reince priebus, kellyanne conway, mike pence -- >> wow put pence on the level of -- >> joe has a diagram going already. >> i just wonder. and then the president-elect trump obviously is on top of -- and you've got ivanka and jared. i just want to know the whole

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president-elect trump will have a full plate when he takes over the oval office next month. at the top of his list is obamacare, and whether you repeal and try to replace that, there's tax reform, war on terror, regulations. joining us on now with more, congressman sean duffy, who serves on president-elect trump's transition team, executive committee and onset with us congressman greg meaks

represents the great state of new york. i don't like saying that, congressman, because they're all great. every state gets that adjective. i think it is true. >> great state. and the city of new york is great. and it's so great, in fact, they have to name it twice, new york, new york. >> i thought it was named after the song, new york, new york? all right. i'm telling you before i unleash congressman meaks on you, congressman duffy, tell us what you think the priorities should be for the new administration, and then i'm going to let him go. so just get ready. >> well, i hope congressman meaks is in the christmas spirit and goes light on me this morning. so, joe, you hit it right out of the gun here. we're going to do tax reform, we're going to do a repeal and replace of dodd/frank -- i'm sorry, we're going to do dodd/frank, need democrats to help on that, but obamacare as well. there's going to be a drive to secure the southern border, whether it's a full wall or partial fencing. all those things that donald trump had talked about on the

campaign trail that the american people bought into, we're going to try to get done. i think it's key to note that we're going to need some democrat support though and help. so there's going to have to be a bipartisan conversation about what the country wants, and what both sides look at as priorities as we work through tax reform, and health care reform, to make sure we can get these packages not just through the house but through the senate because as you know you have that 60 vote threshold in the senate. and there's only 52 republicans. so eight democrats as kellyanne mentioned who come from red states that donald trump won are going to have to get on page and help us out. >> yeah, we need a new list of red states because they aren't -- you know, they weren't the red states we were used to. >> that's right. >> but they turned red this time. congressman, you know chuck schumer. and there have been, i don't know, some rumblings that maybe he's got a relationship with donald trump and that maybe he's going to be willing to play ball on some of these issues.

do you have any inside info on that? would you tell him to do that? or would you dissuade him from doing that? >> listen, i think that the current president has said we want to see donald trump and anyone whoever is the president of the united states to be successful, however, we've got to look at what policies they're putting forward and make determinations from there what we do. and thus far it is hard to figure out exactly what donald trump will or will not do. because if you go by the campaign, some things he's rolled back, other things he has not. you talk about tax reform, you talk about, you know, for example i think that folks can look at tax reform, but there's got to be are you talking about just stripping government completely? are you talking about finding additional revenue? are you talking about hurting the middle class? are we removing all of the social netting for seniors and others? so the devil is always in the details. and we're not sure what donald

trump will propose. if you go over his record from the beginning before he was running for president, if you listen all through the campaign, he's been all over the place. so we don't know where he is. >> let's single out one thing. congressman duffy just talked about dodd/frank needing democrats help to actually roll it back. you're on the financial services committee. what would you be willing to detract or delete from dodd/frank currently? >> we have to always talk. there's always been talk in regards to there's no perfect bill. there's never been a bill that's been passed that is absolutely perfect. we have always been ready to look at unintended consequences. and fix various things that are unintended consequences. i'm not negotiate those deals here. >> which i'd like you to. >> but what we don't know is we don't want to eliminate dodd/frank. dodd/frank has done very good things. and to talk about just repealing dodd/frank is not the way to go. so democrats will stand to

protect dodd/frank. but if we can do certain things that can make it better, that could eliminate unintended consequences, democrats are willing to be at the table. the problem has been is just the same thing with obamacare is we're just going to end it, not try to figure out what we need to do to make sure it works in a better way. >> congressman duffy, how fast can tax reform get passed? that is one thing the stock market has risen to records on the hopes of. >> you know, in the first 100 to 200 days i think we can, you know, realistically get tax reform done. as you know it's a complicated code. there's a lot of interests of people who care about what tax reform look like. we want to make sure we're listening to those folks. but i think with all the work we have done in the house, you know, this tax reform package has been worked on, you know, for four to six years. so there's a lot of ideas, a lot of the groundwork has been done so we can move relatively quickly when we decide to go. that's a positive -- >> is it a 2017 thing on tax reform?

>> absolutely. >> absolutely. >> again, the devil's in the details. i want tax reform, but i want to make sure there's also revenue and that donald trump, if he should fix -- you know, we haven't seen his tax, if he can fix and make sure people like him are paying their fair share of taxes, then we can go get some things done. >> all right. gentlemen, thank you. maybe we will. maybe we will. congressman duffy, good to see you again. >> merry christmas. >> congressman meeks, merry christmas. we want to talk with the millennial board game. >> what? >> some of those games there's a winner. >> everybody can get a trophy -- >> no, out of four people you can be fourth place. anyway, this morning's biggest movers.

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where investors can investigate and invest in vests... or not in vests. sign up at etrade.com and get up to six hundred dollars. let's get a final check on the markets. futures had turned positive. now you'd have to say they're basically flat, red again. the dollar we'll see 1.04. the yen 1.17. oil actually was a little bit higher earlier, now it's actually down 52.38. so you guys like participation awards? >> uh-huh. everyone gets a trophy.

or a ribbon. or a medal. >> you can have fifth place in monopoly if you finish last. >> of five people. >> it worked for the millennials because we certainly don't want to trigger everyone. >> we're all winners today. i think that's what we can take away from this. >> and one more day before christmas break, make sure you join us tomorrow, "squawk on the street" is next. ♪ good morning and welcome to "squawk on the street." i'm david faber along with jim cramer. we are live from the new york stock exchange. carl quintanilla has the day off. let's give you a look at futures right now as we head into the trading session, a half hour from now. not much, not much going on there. european markets you ask about and i will answer. and will i get -- no, i didn't get spain and italy. come on, guys. all right. but there it is. you ca