2017. "squawk box" begins right now. ♪ live from new york where business never sleeps, this is "squawk box." good morning, everybody. welcome to "squawk box" on cnbc. we are live from the nasdaq market site in times square. i'm becky quick along with joe kernen and andrew ross sorkin. our guest host is jason trenner. >> 88 points off 20,000. >> 87. >> 87 points off. yesterday the dow was up by 113 points. markets were up across the board. the dow 87 points away from 20,000. it looks like the dow will open up by 61 points. we're within striking distance of that 20,000. app was up by 15 points

yesterday. since the election the s&p is up by 6.5%. nasdaq looks like it would open up by 20 points. we'll keep a close eye on these futures. look at the treasury markets, treasuriy iey ies have been und pressure. oil prices right now look like they're down slightly. that's a giveback from yesterday. wti down by 1%. brent off by 1%. wti trading at 52.59. >> let's get you caught up on some big headlines. cisco systems buying software company appdynamics for $3.7 billion. it was gearing up to be the first tech ipo of the year and was supposed to price tonight at $2 billion, but getting picked off by cisco. chuck robbins will hang out today at 9:00 to talk about that transaction.

that's one of his first interviews about this deal. apple nearing a deal to manufacture products in india. a team of executives met with senior government officials in delhi. in a brief statement apple saying they appreciate the open and constructive dialogue. the tech company has been requesting tariff -- alcoa with better than fourth quarter revenue. >> maybe that's why we're reporting alcoa first -- not first, usually first. now we're -- >> yeah. what happened. >> split. >> yeah. that's what happened.

my 18-year joke of -- >> alcoa being first like in aa -- >> name your company acme. people don't -- that might not work anymore. >> people don't go to the yellow pages. >> no. no. do we count this ipo as an ipo? >> no. >> it's not an ipo. we missed by 24 hours of saying -- >> it's an acquisition. the ipo market has been dead. this would have been added into the total, but it doesn't count. >> it gets into the m&a count. >> you love your m&a. i -- into my head so much, when i saw those galaxies merging yesterday, the little ones merging to become big ones, i thought of you. i did.

>> president trump is expected to sign an executive order today to begin paying for that wall on the u.s./mexico border. is it a wall or a fence? >> it's a wall. >> fence. >> big, beautiful wall with a small opening. trump tweeting last night big day planned on national security tomorrow. among many other things, we will build the wall. you have to love some of his tweets. he tweeted about fox new s verss cnn. did you see that? >> i did not. >> did you see it? >> i did. but i wasn't loving it. what's the line for mcdonald's? i wasn't loving it. >> can you let trump be trump? one of them was about -- i thought there would be martial law in chicago by the time he was finished. >> you have a problem with using the word carnage for what goes on in chicago? >> when he says i will send the

feds in the tweet is if chicago doesn't fix the -- >> not the first time he said that. >> but those types of things, if you go online and you think of people on the other side of him politically who get anxious -- >> i don't have to think about them. i'm looking at one. >> i think he's trolling the media, don't you get that? i almost get the sense that he's -- i almost get the sense that it's -- >> trump being trump. >> it's a strategy. >> we all have the breaking news breaking tweets. i think he appreciates it. >> you know what it goes back to to one of the most insightful things said. the left takes him literally but not seriously. his supporters take him seriously but not literally. a senior administration official tells nbc news that the president will shift money from other federal programs to the wall project. congress would have to approve any extra appropriations. trump still intends for mexico

to pay for the wall eventually. some interesting stuff coming from mexico about these nafta negotiations. they're ready to walk away if they're going to lose. >> they are coming here tomorrow. >> the meeting with the president. if it's anything less than they have now, they're ready to walk away. but 80% of their exports come here. they are talking about canada, china. >> it's a similar story with canada. >> i don't know how much leverage you have. we'll see when push comes to shove. >> president trump clearing the way for two controversial oil pipeline projects that had been rejected by the obama administration. president donald trump has signed two executive orders to advance the construction of the keystone xl and dakota access pipelines. president trump said the executive orders would help to meet his campaign promise to create american jobs.

among the benefactors of the pipeline news is flor. here's what's david seton said on closing bell. >> we don't do anything the way we did the old way. there's new technologies, new capabilities, and there's new capabilities in the united states to produce that pipe material and other things that would be used in this pipeline, the dakota pipeline or anything like that. i think it's just a matter of retooling the system for the capacities that would be required to put that pipe in the ground. >> as for jobs, the ceo says there is likely to be a shortage of workers as the united states begins building a lot of the infrastructure, but predicts the positions will eventually be filled. to the news at the intersection of business and politics, gary cohn of goldman sachs, former president, now turned head of national economic council for donald trump,

getting a big exit package as he leaves goldman sachs. $100 million. he left the bank to lead trump's economic council. that money would have been tied up for years had cohn not taken a role in the administration. new filing showing that cohn received $65 million in cash to cover future bonuses at the bank and stock market that was locked up or subject to clawbacks. cohn will be forced to sell those shares. he will defer the taxes, but eventually will have to pay them. there are some taxes here that he will have to pay as well. >> a hundred as a percentage of what he's probably already accrued for working at goldman for such a long time, would it be 50% of what he's already accr accrued? 33%?

what do you think? >> maybe a third. >> if you think, wow, he made 100 million at goldman. >> you're trying to say it's unsubstantial? >> i'm saying if this is stuff he had, the only thing that changes is that he gets it immediately. >> do you like it? >> i have no problem with it. i wish i had an exit package of a $100 million. >> no, no. do you like -- >> do i like the idea that it happens immediately? you wrote the column on thischl. i agree with whatever you said. >> okay. thanks. >> it's just easier. i'm in a good place, right? bob evans -- >> i'm going back to bed. >> save that to tape. >> so many good things are happening. you can't rain on my parade anymore. we could be -- we could be

considering hillary clinton's cabinet members right now. we could be listening to -- >> why go there? >> that's why. >> that's your alternative reality. >> if you're going to get a compliment, you will get the slap back, too. >> that's the counter factual. so along with that, i agree with you on everything. >> what happened with bob evans? >> bob evans farms is selling its restaurants unit to golden gate capital for $565 million including debt. the company says it plans to focus on its refrigerated food business. seagate beating the street and forecasting current quarter revenue above estimates. the hard disc drive -- got to be careful with that. hard disc drivemaker gaining a boost from its cloud based storage products.

>> and the head of gap says he's leaving. >> thank god. >> you are not allowed to wear cargo shots. they haven't sold cargo shorts. the retailer -- >> when is the last time you have been in a banana republic? >> when is the last time i've been in a retailer or than sachs when we get our clothes. >> my 1% friend over here. art peck will oversee banana republic while they search for a replacement. and capital one, samuel l. jackson does stuff for capital one. what's in your wallet? >> we're looking at the mexican peso. >> fourth quarter profits falling 14%. missing forecasts despite higher

growth. the company will spend more money on marketing to acquire more customers. they're messing with me this morning. these keep on coming. >> the hits keep on coming. >> i was going to talk about deblasio versus hillary. what do we think about that? 50/50. >> i can even get started. >> who would you pick? you would pick hillary, right? >> i would, right. >> i'll let you start picking. >> will you vote for deblasio again? >> i did not -- first of all, i -- i -- first of all, i don't think i voted for deblasio. >> you don't think? >> no. >> that's not something you would forget, is it? >> i think, as you like to say, what goes on in the -- you - >> you're right. >> but in this particular instance, i don't think i voted for bill deblasio. >> that would be a viable alternative, otherwise he will get re-elected.

>> i don't -- >> you don't know? >> she's not going to run. >> i thought it was 50/50? >> says who? >> i saw that yesterday. why wouldn't she? >> i don't know. all she does is walk around in the woods now. discover financial's fourth quarter profit rose 13% topping forecasts, total loans rose 7% as the company says it booked more new customers in 2016 than in any year sense tsince the financial crisis. texas instruments forecasting first quarter profit and revenue that was slightly above analyst expectations. maybe the tabloids like that story. >> there was a poll that -- i think a poll that sparked the whole thing. >> i thought someone was citing a source close to her. >> i'm considering it, too. >> you're considering her running? >> he's considering running.

>> someone has got to fix this city. >> the carnage? >> the carnage. >> sorry, that was chicago. earnings will dominate the agenda. with no major economic reports expected, before the open look for results from abbott, boeing, united technologies. after the close, numbers from at&t, ebay, qualcomm and las vegas sands. get to our markets roundtable, joining us is lindsay bell and brian belski. our guest host is david trennert. you have a new book out? >> another one. >> huh? >> another one. >> it's called "what's it all about alpha." >> when do you have time to write all this stuff. >> i write every week for our client. i put it altogether. >> just rehash stuff? >> it's not rehash.

>> there is a famous song, remember the movie, what's is about alfie. maybe we should play that when we talk about it. we'll get to you in a second. i like you now. . thank you. >> because you're like 2300, 2424 2400, 2500? what is your range? >> 2350 best case. >> what is going on right now? is it animal spirits that become self-fulfilling or is it that we are underestimating what all these initiatives could add up to? >> underestimating. >> really? >> yes. at the end of the day you have to think about the construct of investing the last 15 years in our world. all we've been doing is cutting

costs, cutting costs. we are so afraid to be wrong. we don't want to be right. we are depending on monetary policy. t the majority of the bull market has transitioned to earnings growth, sales growth. it should be more bumpy as we transition to a biased type environment. this is an environment of picking stocks, looking at earnings, company themes, active investing. the days of locking at and building portfolios only around etfs are over. this is about value investing, bottoms up investing, warren buffett, peter lynch picking stocks and sticking with them. >> lindsay, do you view it that way? maybe some of the impediments to u.s. business -- if you cut regulation by 75%, it may be a game changer for the way --

>> no. but i do think there are some animal spirits in this market. we have gone over 70 days without a 1% pullback. we're more cautious right here right now. the fundamentals are coming back. trump is leading the way. he's in his third day of office. yesterday was a great day. he signed some executive orders, made the market move, but we will get more fundamentals today and next week. management teams will continue to be cautious because they don't know how his policies will be immplemented and how quickly. >> andrew, i hate to give you this, did you read holeman jenkins today? >> yeah. >> that gives you pause. i don't know if you saw it. he does point out some of these things that seem like they make sense on the surface you connect all the dots to what it leads to it's not a panacea for the

problems that we have. it sounds great. manufacturing jobs will stay. that might not necessarily lift all. did you like that? you love holeman. >> i love holeman. when we agree and disagree. he's one of the most thoughtful writer the out there in business. >> it's the last paragraph. i keep waiting what is the conclusion. as for mr. trump there are many ways to be president. he has a bright cabinet. whether mr. trump is any kind of a solution or just a new kind of disaster is still a question mark. >> i think that's tough. it's a tough argument to make at this point. as far as animal spirits in the market and the economy, i can say as a business owner it's so hard. you can't model it but it is so hard to model or forecast what

confidence does to people in terms of hiring decisions, capex, and so many decisions -- i'm a little company, but i talk to guys who run big companies. a lot depends on how you feel at a particular moment. it goes back to kind of what -- >> to hire or not higher. expand or not. >> i think a lot of proposals are mainly focused on getting capex higher. that's a very significant change. you're transitioning away from financial engineering to actual real growth. to me the big risk to the trump trade, if you will, eventually is inflation. that could be a year and a half, two years. >> could be the second term. >> the thing is those -- you're starting at. 4.5% -- >> it might be mike pence's

first term. could be. >> could be in pence's first term, how far away is that? >> eight years, like nine years away. you're missing it. ivanka's first term. this is dynastic. you need to think that way. >> it's not like we don't do that here. we like to think how quaint the royal family is. >> the bushes. >> the clintons. they tried. wait until chelsea runs. >> people are telling me that's a step -- >> that's more likely. >> teddy roosevelt ran for mayor after being president. i didn't know that. thank you lindsay. >> thanks, joe. >> you were awesome. >> thank you. >> you're very welcome. you bet. you'll be here for --

>> i'm sticking around. >> coming up, when we return, mcdonald's giving away 10,000 bottles of its big mac secret sauce. we'll tell you details what it could tell us about the fast food giant when we come right back. bp engineers use robotic ultrasound technology,

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♪ mcdonald's is giving away the special sauce. i think of buffett, that the u.s. economy has that special sauce. >> i think of the simpsons. we need that special sauce. >> i think of two buns, special sauce -- yeah. yeah. to celebrate the rollout of the -- this is what this is about. to celebrate the rollout of the revamped big mac sandwiches. the golden arches will hand out 10,000 bottles of that sauce. the big mac special sauce. >> but not the recipe. >> no. but you could probably reverse engineer it if you thought about it. >> this is interesting to me. >> i like the sauce.

>> you have never heretofore could not buy a bottle. only certain locations will have it. mcdonald's is offering the big mac in two additional sizes, the mac jr., just call that the mac. it's not a big ma'am. just a single patty, and the grand mac, should be the mac daddy. yeah, we should help them market. it features a larger patty and an extra slice of cheese. i haven't had one to years. i'm not opposed to it. >> the sauce is good, it's like a french dressing and -- >> it's like a fat bomb. but it's good. >> yeah. >> if that's what you're ready for. if you're looking for that. >> comes with an angioplasty on the side. that's on the simpsons, too. homer is eating, you can see -- >> see his veins, arteries starting to harden. >> we should sell our secret

sauce? bottle it. this is magic in a bottle? >> a new apple watch patent revealing a wrist band that can be customized with sensors, batteries or a camera. can you think about -- i know the way your brain thinks. think about. the company says modular components could also function as a thermometer, blood pressure sensor or sweat sensor. >> what do you need a sweat sensor. >> were you making a perverted comment? i would be pointing the camera at different -- i don't know what you're pointing out. >> it's more and more like a rick tracy sort of watch. >> i heard. >> i'm back to wearing my jawbone. this one has sensors inside that measure the -- your heart rate and also the heat coming off your -- >> is that a temperature thing? >> temperature and all sorts of

things. it's supposed to figure out when you're sleeping. that's how it figures out the rem sleep which is different than deep sleep. >> i know how much rem sleep i'm getting. zero. >> i'm afraid to make jokes. i'll go to break and then tell you what i was thinking. coming up, the top stories, and a new look inside airbnb. the company transforming the way travelers book rooms and disrupting the hotel industry. the full story including some controversies. first as we head to break a look at yesterday's 500 winners and losers. opportunities aren't always obvious. sometimes they just drop in. cme group can help you navigate risks and capture opportunities.

we enable you to reach global markets and drive forward with broader possibilities. cme group: how the world advances.

good morning. welcome back to "squawk box." let's look at u.s. equity futures. the dow jones looks like it would open up 65 points higher. s&p 500 up by 6 points. chinese state media reacting to president trump's trade policies and comments. an article in the peoples daily warning a trade war between china and the u.s. could harm both the countries. the article saying since china andmajor players

in global supply chains, numerous other countries would be harmed. to corporate news, wells fargo will eliminate its policy of giving branches advance notice -- this is crazy. they would give them advance notice? before visits by internal inspectors, that after the "wall street journal" reported yesterday on the advanced notice describing how it gave employees time to cover up problematic sales practices. the move is part of the internal review following charges that it created consumer accounts without customer authorization. novartis reporting quarterly results that missed expectations because the company is also announcing a $5 billion buyback of its eye care business. a new book out "the airbnb story" dives into the company's

founding. joining us is lee gallagher, assistant managing editor of "fortune" magazine. i asked you how long airbnb had been along. i was shocked when you said 2008. it's hard to remember this industry before they existed. >> it's so rapidly transformed the hospitality landscape. they have had 140 million guest arrivals. it's doubled almost every year of its existence. it's gross that is pretty hard to come by. >> how did it happen. i understand why it makes sense, but how did they strike on this idea? >> the original idea like many start- start-ups that become successful, they didn't think it was a big deal. they were in san francisco, there was a conference that came to town, maxing out the hotel

supply. they were designers, s.e.c. said i have an idea, let's rent out space in our room, call it an air bed and breakfast. they did that. it's a story in silicon valley, but that was not the original intent. they thought they would pay the bills with that while they thought of another big idea. once they settled on that getting it off the grown was a painful struggle. they had to launch three times, four times. brian chessky has given advice to others, if you keep launching, nobody notices, keep launching. nobody will notice. they were told no by almost every investor in the valley. >> what does this say about the sharing economy? people talk about this new way where we will reuse hard assets like homes that are not being

used. yet if you look at a real valuation sp valuation perspective, maybe uber and lyft are about 70% of this economy. but so many others, whether it's cleaning services trying to re-use employees -- >> healthcare -- >> doesn't seem to be working. >> nobody has broken out the way those two do. it's not sharing. we're paying thor these services. they're also lumped together uber and airbnb. their different. airbnb had changed the way many people look at an extra bedroom in their home. it changed the way people travel. they're different. airbnb has hosts who rent out the space. there's not questions of whether they should be full-time employees. >> at the same time it comes

with controversy. there's a situation where the hotel industry says wait a second, you'll charge us 25% touri isis isism taxes, have tht guidelines, and this sub industry december end have to need that. >> airbnb's regulatory issues are the most complex. they have so many different kind of rules and regulations that they go against. this is municipality based, not even city by city. it's town by town. it's across the world. >> towns that are losing tax revenue as a result. >> yeah. >> there's a lot. >> there's the tax issue. the neighbor issue. that's a big issue. >> how profitable is this business? >> they're cash flow positive. the model is efficient. this company is built on other peoples assets. >> you think they should be making money left and right? >> it's an efficient model.

that's one thing that investors like about it. that's why they keep coming in. the other thing about airbnb, the way it grows, they don't have to spend money to seed markets with offices, it's network effect. >> you haven't done this, have you? >> i have never used it either way. >> i used home away. >> so have i. when i first heard about this, i said i've been using home away for years, vrbo. this is nothing new. all these silicon valley companies try to reissue something. >> but it's different. >> you good to paris, if you could see exactly what you are getting, where it is, what it's like inside. >> you can. you can. >> okay. then i have to cook, right? >> you don't have to. there's restaurants in paris. >> i know, but no one is coming to clean my room? >> there are services to do that. >> how dirty are you on a day by day basis? >> we need a maid. >> the one thing you don't have. >> there are advantages to a

luxury hotel. >> i'm a big fan of a lobby bar. >> i'm trying to think what would push me over or you to do this. i don't see it happening. >> you have four people in your family. you have a big extended family, you all want to stay together. a lot to of times i travel with 15 people, i have my brothers, their families, parents. we all like to stay together. >> the other thing is vrbo and other places are beach and mountain towns, airbnb from the start was urban. that's why it took off with millennials. >> waiting for you. until you do it, i'm not doing it. >> what about bed bugs? >> i'm not a big sharing economy person. >> selfish. >> i don't know if it's my age -- >> i bet you do uber. >> i don't. too t now it's easier for me to take a

taxi. >> both uber and airbnb, they have eclipsed -- they started with plug-in tech, and now in my book i have somebody who is in her 50s, lives in a suburb of atlanta, loves airbnb. it's jumped the shark and gone to the baby boomers. some of the early adopters think airbnb has gone too mainstream. >> the reason you can take a cab whenever you want now is because so many other people are using uber. >> exactly. the same issues exist as far as what the legacy businesses have to deal with from a l regulatory -- >> there is an unfair double standard. >> lee, thank you. >> congratulations. >> thank you very much. fun to talk about this with you all. >> bed bugs. >> you get bed bugs in a hotel. >> i got one in a really nice

hotel once. >> what did they give you for your bed bugs? >> they denied it. >> they denied it. >> coming up, another -- >> say who. >> may be bringing jobs back to the united states. another one might be doing it details next. and an ultramarathoner and a businessman tells us about the future of wearable technology. then jason trennart on the trump rally. stay tuned, you're watching "squawk box" on cnbc. the newly advanced gle can see in your blind spot. onboard cameras and radar detect danger all around you. driver assist systems pull you back into your lane if drifting.

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welcome back. look at the u.s. equity futures. yesterday the dow was up significantly. ended up closing 87 points shy of the 20,000 mark. this morning the futures are indicated up 63 points. as you can see, it's just spitting distance to get to 20,000 from here, if we open at these levels. >> a lot of times it will be up 63, before you know, it's up 80. that's all you need is 87. >> s&p futures are indicated up by 6 points. nasdaq up by 20. >> i'm feeling it you feeling it? >> potentially. i won't bet against you.

>> andrew? >> i'm feeling it. >> feeling it. >> i don't even know what that means. >> the secret sauce coming out. >> i want to find out which locations you can buy that. >> people are writing n it's thousand island. >> it's good. >> it is good. president trump has been encouraging companies across the world to build their factories back here in the u.s. to increase american jobs, and now samsonite may be up for the challenge. a hong kong-based firm, based in hong kong, founded in denver, colorado. but closed the business there 16 years ago for profitability reasons. but the ceo said the brand could soon return to its roots. >> we manufacture luggage globally. we have a lot of manufacturing which is done in europe. we have been expanding manufacturing in europe. we also do some outsourcing in

china, vietnam, india and some other places. i think, you know, we basically get guided by, you know, where bulk of our business has been done. today undoubtedly almost 40% of our sales are happening in the u.s. at an appropriate time we will not hesitate to look at possibility of manufacturing in the u.s. >> pretty interesting. >> the bags are no good anymore. >> people use other ones. >> it's really mean of you -- a guy comes on and says that and you come out and say -- >> i this they're made -- >> they used to be better bags. >> maybe if they're made here again. >> you're a tumi man. >> make samsonite great again. >> i have used tumi for a garment bag. >> i thought you were a tumi person. >> that would be you. >> i am a proud tumi person. >> that's a fashionable, trendy, smart -- that's not me. >> that's what i bought matt.

>> a tumi? >> the ceo of samsonite insists the willingness to explore the u.s. is not because of president trump but he's been looking into the move for a while. let's talk wearable tech. smart devices are becoming popular, but the appeal seems to be cooling, either because battery life has not improved or because innovation has stalled. we have the author of "the road of sparta" joining us. you are a friend of martin franklin. >> you know him. sorry to hear that. he's a good guy. >> do you have anything on your wrist these days? >> i'm wearing a fitbit surge. i'm bullish on the future of wearables. i think in the next five years we'll see an explosion of all

types of devices, ones that measure lactic acid levels. i'm wearing a jawbone, but what do you learn from your watch there? >> one has an optical heart rate sensor. i get my heart rate on my wrist. two, it has a built in gps. i don't need to run with the phone. it does cadence. foot turnover. >> where are you on the apple watch? >> i tried it. for pure fitness sake, the fitbit is much better, the surge. of course i'm with the book that is sponsored by fitbit. >> the guy who ran all the way to sparta, got there, warned the army, did his job, but then died. why would you run this road.

>> why does anyone want to run a marathon? >> correct. >> he ran much further than a marathon. he ran 153 miles from athens to spartd sparta -- >> so the marathon wasn't what killed him. it was everything else? the marathon was the final nail in the coffin. we love pain. there's 50,000 people out there -- >> it's good for your body. seriously. i always think i should run a marathon, then i think this is actually good for me. >> everyone should do it, just once. it's a challenge. it's something that will never go away. it will be more difficult than anything you've done. graduate school. >> are you addicted to it now? i think it's a healthy i diction. i wouldn't deny i'm addicted. >> how about your joints, a serious health question. do you think you'll need knee replacements when you get older? >> i have the knees of an 18-year-old. by all measurements i'm a healthy man.

>> you look great. >> are you flirting with me? >> no. >> i'm a married man. >> i'm married, too. >> her husband is actually here. >> yes. >> oh, now i'm in trouble. >> he's not over there right now. >> i just flew up from san francisco. didn't sleep, i feel fantastic. >> but in terms of -- going back to the wearable stuff, how do you think it's changed your behavior? it's one thing to track it. by the way, sometimes for me, just ultimately it creates anxiety. that's what i think happens. i haven't slept. so -- maybe it says i should sleep more. but i sort of know that. so the question is, are there actual things you've seen come up on your watch where you said, okay, now i have to change what i'm doing? >> sure. when your heart rate is accelerated, sleep is disrupted that could mean you're overtraining. you can monitor recovery

post-marathon. look at sleep patterns, heart rate continuously throughout the day. all these things are indications of your state of fitness and recovery at that moment. >> can you tell us about the book? >> the book is -- i'm 100% this is a work of history basically. i worked with paul carteledge from cambridge university. i re-created the ancient foot race. i ran from athens to sparta eating only figs, olives, cured meat. i re-created the original marathon. >> and you're still here. >> how did you do it without dying? >> i almost died. yeah, no, i had hallucinations, out-of-body experiences. i fell asleep while i was running, woke up running down the middle of the road. i was just willing my body to keep going. >> how long did it take? >> 34 hours, to run 153 miles.

you don't sleep. >> no caffeine. >> no caffeine. >> tell me you're doing 12-minute miles. >> sometimes you're doing sub-seven minute miles. you're climbing mountains. >> i'm never doing sub-seven minute miles. >> thank you. congratulations on the book. >> i think it was a 13-minute mile. climbing up the side of the mountain. i was never flat. it's southern greece. >> wow. >> all right. when we come back, we're going to talk dow 2,000, earnings, and today's top test for the markets. stay tuned. you're watching "squawk box" here on cnbc. this car is traveling over 200 miles per hour.

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our guest host this morning is jason. we've been talking about dow 20,000, how close we are today. what do you think is happening behind all of this in the market? >> listen, i think largely this is a continuation of the trump trade. i think it's largely a departure from monetary policy, towards fiscal easing and regulatory

easing. i think the largest part of the trump trade is over, to be candid. the harder part is going to come now. >> some of the unintended moves? >> the biggest places where i think there's the biggest departure from the last administration is financials and energy. i think you're going to see big deregulation there. i think it will be very, very positive for economic growth later on this year and into 2018. >> jason, thank you so much for coming and spending the morning with us. always great to see you. >> i appreciate it. thank you. when we come back, the first hundred days and the trump trade agenda. we're going to talk to the former u.s. commerce secretary, bill daley. stay tuned, you're watching "squawk box" here on cnbc. ♪

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market alert. global stocks hitting a 19-month high and earnings are in focus this morning. in this hour, dow components, united technologies, and boeing report and could set the tone for today's trading session. we're not far from 20,000. we break down the results and get market reaction straight ahead. president trump moving on two key pipeline projects yesterday. senator heidi heitkamp joins us to talk about what it means for her state and the country. that interview is minutes away. and technology that helps you fly through airport security. clear is expanding its technology to some of the busiest airports in america. the company's ceo joins us to talk about how they're disrupting the check-in process. the second hour of "squawk box" begins right now. ♪ live from the beating heart of business, new york city, this is "squawk box."

good morning. welcome back to "squawk box" here on cnbc. we're live from the north america -- nasdaq market site in times square. take a look at the futures at this hour as we get closer to 20,000. the dow possibly hitting it today. we'll see whether we get there. dow looks like it would open higher, about 63 points higher. s&p would open about 5 1/2 points higher. broader markets climbing higher yesterday, including a record close for the s&p 500. the telecom sector was the big winner there. check out the nasdaq, gaining 48 points and sitting on a record close itself. looking at it right there. finally, check out the ten-year note. 2.475. joseph? >> dow component, united technologies, just out with earnings. fourth quarter profit of $1.56 a share, matching consensus estimates. revenue also was in line with forecast. and the company also affirmed

its prior outlook for 2017. that's going to help the dow. so far today looks like trading near an all-time high. here's some other headlines this morning as well. a multibillion dollar ipo has been pre-empted. cisco systems is buying software maker appdynamics. appdynamics had been expected to price tonight and go public tomorrow. so there's an ipo that's been shortchanged. cisco ceo chuck robbins will be talking about the deal when he joins "squawk on the street" at 9:00 a.m. eastern time. and tech strong, the company behind cessna and beach craft, reported quarterly profit of 80 cents a share. that missed expectations by 7 cents. the company also announcing a weaker than expected 2017 outlook. separately, they announced the acquisition of arctic cat for $247 million, or $18.50 a share. dow component boeing is set to report its quarterly numbers

at the bottom of the hour. boeing expected to earn $2.35 a share on revenue of about $23 billion. european central bank policymaker -- this is unfair. it's unfair. it's not fair. now they're showing what's in the teleprompter. i knew you were up to no good. you had to be behind this. >> and i've been practicing. sabine lautenschlaeger. >> i knew something was going on over there. here's the thing. it really is an important story. >> it is an important story. >> and she's -- i've never heard of her, obviously, but she's an ecb official. i said, you got to have andrew just looking at that thing when it came up. it doesn't fit on one line. the first name you would skip. but what she is saying, though,

which is important, is that the qe in europe, they got to start letting it run off. >> oh, she's the one who was talking about this. >> it's on like page 86 of "the journal." >> i read this last night. they didn't have her name last night. >> what viewers don't know is sometimes we read stuff cold off the teleprompter. it just comes up. >> you never preread your scripts. >> wow. >> sabine lautenschlaeger. >> bless you. >> i do admit i requested the story for you specifically. >> entrepreneurship never fits on one line. throws me off every time. >> she called on her colleagues -- lautenschlaeger called on her colleagues to prepare to start talks on winding down the institution's bond-buying program, all preconditions for a stable rise in inflation exist. now, the executive board members said -- she said that in a speech in hamburg.

>> i think that is significant. we've been over here diverging. we've been saying we can't diverge forever with qe and bond buying. finally, they might be winding it down according to sabine lautenschlaeger. >> then you're looking at a situation that impacts the currency market. they've been continuing with this loose policy. >> can we call sabine? have her call into the show. >> we're ready for her. >> now we are. >> damn right. sabine lautenschlaeger. >> i'm glad that didn't come up in my prompter. i would have no idea what to do. >> why would i do that? >> sabine lautenschlaeger. >> this really is worth doing too. >> it is an important story. let's get to politics here in the united states. president trump is expected to sign an executive order today to begin paying for the wall on the u.s./mexico border. trump tweeting last night, big day planned on national security tomorrow. among many other things, we will build the wall. a senior administration official tells nbc news that the president will shift money from

other federal programs to build the wall. congress would have to approve any extra appropriations beyond that, but trump still intends for mexico to pay for that wall eventually. in another political news, president trump clearing the what i for two controversial -- i would say politically charged might be a better description of these two pipelines. both projects had been rejected by the prior obama administration. as you have heard by now, it's a front page lead story on just about every paper, late yesterday the president signed executive orders to make it easier for trans-canada to construct the keystone xl pipeline and for energy transfer partners to build the final yet uncompleted portion of the dakota access pipeline. the president said both executive actions were subject to terms and conditions so there's not going to be some new negotiations with canada and with these companies. canada, meanwhile, said we are going to reapply. we're glad to do this. doesn't mean they're going to get done at this point.

depends on -- he could still screw it up. i would consult with sabine lautenschlaeger on some of the terms. i don't know whether you agree, andrew. >> i'm always -- i'm calling sabine right now. whatever sabine says. >> shares of energy transfer partners an trans-canada both rising on the news. among the benefactors of the pipeline news, floor corp. here's ceo david seton on "closing bell." >> there's new technologies. there's new capabilities. certainly there is the capability existing in the united states to produce that pipe material and other things that would be used in this pipeline, the dakota pipeline, or anything like that. so i think it's just a matter of retooling the system for the capacities that's going to be required to actually put that pipe in the ground. >> and we will have more on yesterday's executive order with senator heidi heitkamp in just a

couple minutes. it was a politically charged -- there are people that want to leave it in the ground. but that was never really going to be what happened. it was going to go -- if it didn't go south, it was probably going to go west to asia. most people would argue that, you know -- >> you mean leave the oil in the ground. >> but they were not going to do that. too important to the canadian economy. then the question is, what's the best way to move it environmentally. a pipeline has less problems. so the rationale never seemed to be that solid, i don't think, with the prior administration. it was clear why they were doing it, to appease the green -- >> they didn't make a decision for a very long time. >> it was okayed a couple times. why are you laughing? you still thinking about sabine? >> because you can have fun with business news, believe it or not. sabine lautenschlaeger.

>> it was almost three lines. i want a name that's like -- >> what's the -- there's a volcano in iceland or somewhere. remember the one that's like 58 letters or something. >> i'm praying for that thing to get activated. >> that came up on the prompter. >> it'll be your read. >> thank you. >> was that it? >> they're ad libbing. >> that was it. we had the audio guy. >> we actually have that at our fingertips. that's how bad that word is. let's take it back to politics and talk about more what's been happening. president trump staying on message with his trade agenda, withdrawing from tpp. how will this impact the economy and u.s. consumers? joining us now is former u.s. commerce secretary bill daley, who also served as special council to president bill clinton on nafta related issues. thank you for joining us this morning. >> thank you, becky. nice being with you again. >> great to see you. there are a lot of changes.

trump campaigned lonon a lot of changes. let's focus on trade specifically and what he said yesterday, both about nafta and pulling out of the tpp. what do you think this means? >> obviously he was very clear in his campaign and his promises he made in campaigning he's going to fulfill. again, today talking about building a wall along the border. some people question whether he'd actually do it. on tpp, i think there's no question it was an integral part of his campaign. i think it is a great opportunity for the chinese to step into a void. i think he's got to follow up getting out of tpp with that aggressiveness in asia. that is the future growth of the world right now. we can't walk away from it. we can't give the impression to our allies or friends in asia that because the president's against tpp that therefore somehow economically we're going to pull away from asia. that is a terrible message. it leaves a void that the

chinese, as president xi said when he was in davos and you were all there, that china is very willing to step into a global economic position that they'd not had because the u.s. has had that position over the last number of years. so i think it's an opportunity for the chinese. it's a challenge to the president not only to do what he said he'd do in the campaign, get out of tpp, but how does he follow it up. does he just walk away and therefore leave the impression he's walking away from asia? >> bill, we're a business network. we've been behind this free trade and open trade for a long time. i will say in the last couple of months, i've heard a lot of people, both on the right and left, who have described the process that we've had to this point in terms of negotiating deals where america really does get the short end of the stick in a lot of situations. what do you think about that? >> i would think that if you went around the world and talked to people, they would they we take advantage of them in every deem we've ever done on anything, whether it's militarily, economically. i don't think the world sits

back and, thinking they've taken advantage of us over all these years. we are the dominant economy in the world. we are the growth economy. we are the one that everyone looks to and reacts to. i think we ought to be proud of that. can we make it greater? can we make it better? absolutely. take nafta for a minute that i had the opportunity to help president clinton pass. can it be updpated? should it be updated? sure. should it be thrown out? that was a regional agreement that brought mexico, canada, and the u.s. in a very strong position. they are two of the biggest trading partners we have. i think there ought to be improvements. no question about it. i think this idea we're going to walk away from it is a terrible thing for the country. >> bill, we're always tweet ready here. this plays into the big news cycle yesterday. the president announced the pipeline stuff. there are people that said the message was stepped on and the

oxygen at the press conference taken out by the voter fraud allegations that the president said he would have won if it wasn't for illegal voting. sean spicer said, well, he believes what he believes. so this is this morning. not backing down whatsoever here. the president says, i will be asking for a major investigation into voter fraud, including those registered to vote in two states, those who are illegal, and -- and then we're waiting for one more tweet, finishing up his thought. yesterday, a lot of the reporters in the room said, okay, if you really believe that, where's the investigation? 20% of the news conference was about this claim, which came after the crowd size claim. he's not backing down and saying just let it -- >> joe, i can't quite understand. having been in the white house, you try to have a message that the american people want to listen to. they want to hear about the economy and jobs.

they want to hear these issues. all this other stuff is just chatter. i can't quite figure out. this happens at the beginning of an administration often, getting organized is not easy. they have a lot of positions. that's why when you talk about trade and the economy, they don't have a treasury secretary. you don't have a commerce secretary. you don't have a trade representative yet. you don't have offices under them filled. so i think there ought to be a little bit of let's walk a little slower right now, get our act together. >> his allies are saying that too, but he is -- he's going to do what he's going to do. >> it got him this far. i don't blame him. >> and he's also got -- this is not going to probably deter him from doing everything else he was planning on doing today too. he can do both. >> but joe, let me just say -- >> the second part of the tweet is, even those registered to vote who are dead and many for a long time, depending on results, we will strengthen up voting

procedures. >> you're all the sudden now mixing two here. he's mixing either voter fraud issues as opposed to there was a massive fraud in his election that he was elected and got at least the electoral college majority. he's making two statements. one is we ought to look at whether there are voting fraud issues. and two, a specific allegation that his election had the largest voter fraud that ever happened in the history of the country. he's got the justice department. he has the opportunity now to prove that fact. >> right. >> but not only to prove it, even if he doesn't prove it, he can create headlines over this issue for months on end. >> but it's not an issue that the american people, especially the people who voted for him, are sitting at home talking about. >> just like he said at the end, he can take the high road and say that voter fraud, we don't want to have voter fraud and

it's something that has happened and something we need to deal with. you can't just toss that out and say, no, we don't care about voter fraud. >> i agree with you. now back up your allegation with your justice department. >> they're killing us. i wanted ask bill, because he's a chicago guy, about the other chicago tweet. if chicago doesn't fix the horrible carnage going on, i will send in the feds. i know people who looked at that and thought that was marshal law coming on day four. >> i don't know what he means, but i hope he does send in federal resources. we need the opportunity for the federal government to help get rid of illegal guns on the street. i don't know if it's marshal law. if that's what he's talking about, i think he ought to read the constitution. >> secretary daley, thank you so much. please come visit us in times square. when we come back, senator heidi heitkamp welcoming president trump's executive order to advance construction of the keystone pipeline and dakota access pipelines through her state. then results from boeing will be out and we'll bing you those

numbers and market reaction. then at the top of the 8:00 a.m., we have national trade council director peter navarro to talk about the possibility of renegotiating nafta. you're watching wa ining "squaw cnbc. what's critical thinking like? a basketball costs $14. what's team spirit worth? (cheers) what's it worth to talk to your mom?

what's the value of a walk in the woods? the value of capital is to create, not just wealth, but things that matter. morgan stanley

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from @realdonaldtrump. i will be making my supreme court pick on thursday of next week. so we know the day. >> how do they get the tweets up that quickly? he literally tweeted 30 seconds ago. >> well, mow it's three minutes ago. >> oh, it's a new system? wow. >> we don't need a system to do the tweet. we need a system to sell the stock he talks about. >> and there are people who built that system already. it's a remarkable thing. >> i didn't hear that. >> i didn't hear what they said either. >> you know, there is a show going on. we're doing a live tv thing. hope you guys are having fun. no. president trump signed several executive orders yesterday, includeing two related to pipeline deals in the midwest. let's bring in senator heidi heitkamp, the ranking democrat on the senate banking committee who supports trump's recent executive actions on the pipelines. senator heitkamp, thank you for

joining us. i hate to rehash ancient history, but you took the elevator, the beautiful gold elevators up to that floor and actually talked -- i think it was the president-elect at that point. there was a possibility -- were you offered a position at that meeting, senator? >> i was extraordinarily grateful to have the opportunity to talk about priorities and issues with the president-elect. >> okay. i know that even though you're out in the dakotas, i wouldn't want to be -- i wouldn't want to receive all the mail you've gotten from certain parts of the democratic party. even for going there, i'm sure you got a lot of flak. >> i did, but i was incredibly honored to be asked. it gave me an opportunity to talk about things like the pipeline, like the export/import bank, which drives me crazy, like what you can do to get americans back to work. so it was exciting, and it was interesting, and it gave me an

insight into, i think, the administration and the administration's priorities. >> we've already sort of talked about the way this became very political and that canada's going to -- the oil is coming out of the ground. it either goes west to asia or it comes south to us and maybe a pipeline is a safer way of doing it. we've been over that. what are the chances now that the devil's in the details and that now it gets bogged down and we take too hard a line with canada on the terms of the deal. it's not a guarantee it's going to get done now anyway, is it? >> i think there's going to be a lot of pressure on the sourcing of the pipe. a lot of that pipe was stockpiled. we think about, you know, 60/40, some coming out of canada. we don't know what the source of that pipe is. that's going to be an issue. i also think it might be an issue on whether that oil gets ek ports, which is something we considered. there was a contract with valero, the refineries in the south-central part of our

country, which is where we refine the heavy crude, like the crude coming out of canada. it remains to be seen what the contract relationships are, but obviously trans-canada is very interested in engaging. they said they're going to reapply. we look forward to that reapplication and look forward to getting american construction workers working again. >> yeah, speaking of that, the job number the president used yesterday was 28,000. a couple years ago, do you remember? someone in the obama administration said it was more like 200. they actually used that number. then others said, well, look at the towns that spring up. look at the walmarts. look at the coffee shops that spring up. they say it's more like 100,000. what do you think the real number is? >> i think the real number is the number of people who will be working to put the pipe in the ground. what we expect is this isn't going to be one crew moving down the line. it's going to be a lot of crews. so i don't think that's an exaggeration to talk about over

20,000 jobs actually constructing the pipeline. the disagreement happened on how many of those jobs are permanent. i think that really ignores the fact that construction jobs -- you know, my dad was a construction worker. he built i-29. then he went up to newton, up to the north part of our state and built another road. so you can say, well, i-29 only meant this many jobs, but workers go from these jobs to jobs. you have to look at it in a conglomeration of what are we doing to build infrastructure and to put these people back to work in critical priorities for the american public. so i'm a little sensitive when people say this isn't a real job. these guys who work on the pipeline, those are real jobs and they mean a lot to their families. >> right. drives me crazy too when we hear they're just temporary. what infrastructure project is permanent?

and here's one. we want public/private partnerships. this was going to be totally private. they looked the gift horse in the mouth and rejected it. >> i couldn't agree more. what's ironic is when you look at the backdrop of that, when the president's own secretary of energy used his quadrennial report to say let's not worry about sourcing energy, let's worry about moving energy, let's worry about energy infrastructure. yet, because of politics, because that's the only reason if you really understood the record, they denied the application. i think it was wrong. it was wrong headed. it played to the keep it in the ground. this isn't going to stay in the ground. canada has already approved a pipeline going west out of alberta, out of the oil sands. this is oil is going to move. it might as well be access nlabnable to refineries here in this country. >> do you have anyone to eat lurch with anymore? >> are you worried about her?

>> i am. are you alone at the table, looking around, waving at some of your colleague from the east coast? do you have company? >> you know, what i'd like to tell you, joe, is after this last election, they're a little more interested in what i have to say. >> as far as -- we always talk about energy with you, senator, but obviously there's been a lot of things in these first -- is it the third day? fourth day? are there things you were happy the president's done? what are you unhappy about? >> you've had me on before. you know that i believe in free trade. the tpp was critically important to american agriculture, some of the worst criticism the president has received from the tpp announcement has been from the cattlemen. so we're going to have to have a conversation about how agriculture can, in fact, help feed the world under this new trade regime. >> all right, senator.

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now the answer to today's aflac trivia question. who was the only american president to be unanimously elected? the answer, george washington. good morning, everybody. welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square. among the stories front and center today, mortgage applications rose 4% last week. that's according to weekly figures from the mortgage banker's association. most of that increase came from new purchase applications with

refinancing activity registering just a slight increase. apple is near a deal to manufacture products in india, according to "the wall street journal." apple's been engaged in talks about tax breaks and other incentives, but the journal now quotes a government official as saying that the deal is nearly done. and korean automaker hyundai's quarterly profits fell to their lowest level in five years. hyundai has been hurt by big discounts on its small sedans. 2016 also marked hyundai's fourth consecutive yearly drop in earnings. >> it's hyundai to me. >> and sabine might start a car company. we'd be selling the lautenschlaeger. >> we have other news to bring you. boeing rolling out quarterly results right now. let's get over to phil lebeau with those numbers. >> andrew, this is a beat on top and bottom line by boeing. the company earning $2.47 a share. that's 12 cents better than estimates of 2.35. revenue coming in slightly better than expected at $23.3 billion. the estimate was for 23.1

billion. operating cash flow, for the year it was a record of 10.5 billion. in the fourth quarter, came in at 2.8 billion. free cash flow, 2.2 billion with margins at 8.9%. now to what a lot of people are going to be focusing on today. that's the guidance for 2017. core earnings between $9.10 a share and $9.30 a share for the entire year. that is just a smidge below the consensus estimate of $9.31. revenue also a little below where analysts are expecting for 2017. boeing is setting guidance between 90.5 billion and 92.5 billion. the street's expecting 93.1 billion. remember, they've got a couple of production cuts for the 777 that have already been announced. that's one reason you're seeing revenue down slightly compared to all of 2016. then you have deliveries, 760 commercial airplanes to 765 commercial airplanes delivered this year. in 206, they delivered 748

airplanes on the commercial side. again, a beat on the top and bottom line. again, the guidance for 2017 is what people will be looking at. we'll be on the conference call a little later on today. guys, back to you. >> phil, thank you very much. again, we're keeping on eye on boeing shares, which right now are up by close to 1.5%. when we come back this morning, united technology reporting earlier in the hour. we're going to talk about that stock and what president trump's plan for defense spending means for investors. right now, though, as we head to a break, take a look at the u.s. equity futures. yesterday the market was up pretty sharply. oh, look at this. dow closed yesterday at just 87 points away from 20,000. this morning it's indicated to open up by 71 points. you are really right within distance of 20,000, if we open at these levels. s&p futures up by 6 1/2. the nasdaq up by 22. "squawk box" will be right back.

united technology was out earlier with quarterly results,

matching estimates on the top and bottom lines. but it's helping the dow this morning. it is adding a nice boost to the futures. as you can see, there's the dow. united technology was up about 2%, i think to an all-time high. joinings now to break down the numbers is the co-group head of global industrial infrastructure at william blair company. is that an all-time high today, nick? >> not all time. it was in the low 120s a while back. certainly moving since last summer when they had an earnings shortfall announcement with the second quarter. >> so it would be a 52-week high. in early 2015, it got this high before. what a selloff between the first half of the year, 2015. what was that based on, do you remember? >> yes, they had come to prepare

to tell us in june that everything was on track. then they subsequently came through with a big shortfall in earnings. >> unbelievable. went from 125 back down to the mid-80s in short order. that must have been painful. anyway, it's made its way back. what in this quarter was positive? >> you know, quite honestly, everything was pretty much in line. sales, eps, margins, organic growth at 2%. the tax rate. share count was a little light, added about 2 cents versus what we thought. free cash was good. at this juncture, one of the most important things is that we're trying to get, which wasn't in the press release, a handle on how they turned out further engine shipments. and the engine shipments for large commercial had to be in

the 110 to 115 to hit their target of 150 that was reduced from 200 here. that's a key thing. this gear turbo nan is a huge program. they invested over 10 billion in it. they had some challenges getting the kinks out of the supply chain. that'll be one of the big focuses today on the call. >> so if i monito monitor @realdonaldtrump or @potus, what do i have to worry about if i'm greg hayes? >> well, joe, really simple, if you go to a territorial cash flow based system with border adjustability, you're not going to be able to move as their business plan calls for a lot of their existing u.s. plans overseas to lost cost plants to help reduce cost while they try to fix the margins at three out of the four businesses this year and next. secondly, they can't really justify borrowing money to buy back stock to help keep earnings

flat. there's a good chance you're going to see an interest deductibility eliminated. so for united technologies, those are two key concerns. they've already obviously locked horns with mr. trump about moving their furnace plant at carrier out of indianapolis to mexico and decided to stay and not move. >> just wondering about additional -- and you just gave a couple of them. man, oh, man. got to give the ceo a lot to think about other than just margins. anyway, hayes took over -- do you remember the month and day? >> yeah, suddenly greg was put into the job as ceo in early december. >> the grinder. that first six months was rough. >> it was challenging. you had the earnings shortfall

>> all right, nick. we appreciate it. thank you very much. the s&p, nasdaq, and nasdaq 100 hitting all-time highs yesterday. so could today be the breakout day to the upside after five straight weeks of sideways trading? that's the question. mike santoli has been looking at key market metrics and joins us right now. >> yeah, andrew, it's been what feels like a long way. five weeks when the s&p 500 and dow have done not much of anything. we talk about the trump rally as if it's this unifying thing that's been going on since election day. not really. the dow is about a 9% move in the six weeks following election day. then almost nothing. sideways since about december 20th. essentially, you had this big reflation move. everything got repriced. then the question was did we have to consolidate that rally, digest those gains, get investor sentiment to cool off a little bit. that process has been under way. you're seeing the futures

showing we might have another try at 20,000. this is all following the bond market. if you look at the pattern in the u.s. ten-year treasury yield over that same time period, it's essentially the same thing. the ten-year treasury was giving you the green light for stocks to rally, starting at election day, peaking i think a week before the dow did, about december 13th. no huge pullbacks. definitely coming on a downward trend. now we've perked up again. the question is, is this a breakout, or are we still in this trading range where we still have to have a lot of give and take. big question about whether we need a deeper pullback. if you look back to august and september, a big rally off the post-brexit lows. it was very similar in trajectory to this one. you did eventually, after a long sideways period of about six or seven weeks v a 3% to 5% pullback, did cool off investor sentiment, then went higher from there. the bond market, not just treasuries, but the corporate bond market has been incredibly strong. it's led a lot of people to say, look, if earnings come through

and the corporate bond market is not getting upset, then you have to believe any dip would be bought. i still don't think yesterday's action and this morning's action is going to tell us for sure if this is a breakout because we have not seen a lot of all the gears working together below the surface of the indexes, but i think it's in play right now to say, look, we've gone sideways long enough. maybe we can have another attempt. >> we're living history, though, here, mike. we've had that long flat line. well, not long. but it's been a month. there's two narratives. one is it's a sugar high and there's a lot of potholes. that would mean the line goes down. the other one is, we just consolidated and we're ready to break out higher. we're going to find out, whether it's the larry summers sugar high or whether there's bullish things happening for the next couple years or not. i'm excited. >> i'd offer you a third story line, which is it's neither a sugar high or all about policy. this is a global move.

global indicators to the economy have been doing better. you can have it be fundamentally based and not a sugar high. policy is perhaps a kicker down the road. >> we've been breaking out at different points for eight years, mike. we were just getting above stall speed and ready to go back to 3% growth. we had like eight false starts. so we'll see. >> by the way, you guys are talking longer term, but for the short term, we are really very close to that 20,000 mark for today. boeing, a dow component that reported earnings, is indicated up this morning. that's going to give a boost to the dow as well. we'll be watching this closely. >> i'm going to try and jinx it. i think between 9:30 and 10:00. >> you are the world's worst fan. >> you with me, andrew? we're doing a high five. >> i don't believe you'll actually do the high five. you'll do the high school thing. >> the fake. then i fix my hair.

>> my kid is 6 years old and does that. >> you've typecast him. >> age has nothing to do with maturity. you will learn that. >> it's not that i will learn that. i have learned that. okay. when we come back this morning, beating lines at the airport. if you can afford it, clear lets its members fly through check-ins and customs, and they're expanding to the new york city area. the ceo will join us after the break. one more look at the futures. yesterday the dow closed just 88 points below 20,000. this morning, the futures are already indicated up by 74 points. you are talking about it being right there potentially at the opening bell at 9:30 this morning. s&p futures up by 6.5. the nasdaq up by 22. "squawk box" will be right back.

welcome back to "squawk box" this morning. trusted traveler program clear announcing a major airport expansion today. the kiosks, which can scan passengers' fingerprints and iris to confirm their identity, are expanding at laguardia, jfk, atlanta, and minneapolis, bringing the total to 22 u.s. airports. joining us now is the chairman and ceo of clear.

joseph knows nothing about this. they don't have this issue at teterboro. thank god you're doing this, by the way, at our airports. we're very happy about this. how long has this been in the process, and why has it taken this long, dare i ask? >> we're seven years in, which feels like dog years. launching new york is something that we've dreamed about, as we're here in new york and using those airports often. it is hard to build a biometric identity company, bringing customers a fast, frictionless experience at airports. the company went bankrupt before, so reproving ourselves and delighting customers takes some time. after a while, customers started to speak for themselves. people are loving it. >> now the precheck seems almost meaningless. that's the thing. this has become even more meaningful. they've given precheck over to so many people. sometimes the precheck line is

longer than the regular line. >> this is the elitism coming back. >> it's a 1% problem. >> by the way, when we came back from davos, joseph didn't even know what global entry was. we have to work on that, but that's a separate issue. >> so technology and innovation change the customer experience and enhance security. precheck is great. i have precheck. i love when i can keep my coat and shoes on. clear is about a fast, frictionless experience. tap and go and into precheck. about 50% of our customers have precheck. so we love the combination together, but you need technology. >> you have just precheck? >> no, if you're global entry, you also get precheck. for those who don't know what global entry is, you apply for a global entry program, which means it expedites you on the way into the country. you also get precheck, can means you get into the precheck line. >> what does clear do on top of that? >> security is really about two different phases. the identity and the physical

screening. precheck is the ability to keep your coat and shoes on. great. clear automates the identity process. think of it as the atm of identity. you can go to a bank teller or come to an atm machine. you go to a clear pod. put your fingerprints down or iris image. then you go to physical screening. if you have precheck, keep your coat and shoes on. >> so you get to bypass all the lines. >> correct. clear members do not break stride. they head into the airport, tap the pod, and in they go. >> but the more important piece is beating the line. it's not -- i mean, i know you think of yourself as a security company and a biometrics company, but ultimately, the point of all that is to beat the line. >> the point of all that is not only to beat the line, it's to have the predictability to know that you can stay at home and have breakfast with your child, have that extra meeting, not be yelling at the cab driver, running through the airport, then putting your belt back on. >> how soon do i have to be there? the airline tells me to be there two hours early. what would you tell your

customers? >> i wouldn't show up 45 minutes before. if you're walking on. >> like when you show up here in the morning. what about luggage? do you have to bring a carry-on? >> you can check your luggage, but we're bringing our platform to other places in the airport, like biometric boarding passes, bag access. we're taking the friction out of the entire system. >> what does it cost, and is it complicated? >> so we are all about simple. it's definitely not complicated. you can start by enrolling online at clearme.com. if you come to the airport, it takesless than five minutes to enroll. you can use it immediately. this is about simple, great customer experience. important to importantly, to your point, strengtheneni strengthening security. >> and you're doing this at sports stadiums. >> yankees and mets. we'll be announcing more. >> will you do the guard season in we were just at the rangers game. >> we would love to do the garden.

we want to bring this to place where is people are waiting in line and stressing out. >> how much? >> price tag? >> price tag, anybody who enrolls at the airport, it's free for a month. we're all about free trials. it retails for $179 after that. we have a special partnership with delta. >> thank you very much. we appreciate it. when we come back, stocks you need to watch ahead of the opening bell. nice work brother dominic. now we just need 500 more... translated into 35 languages, personalized oh and shared across the 7 continents. (other languages spoken) look abbot, i got it. it's a miracle. ♪

a couple stocks to watch, as promised this morning. shares of brinker are under

pressure this morning. earnings missed on both the top and bottom lines. also gave a weaker than expected full-year earnings forecast. seagate technology earned $1.38, beating estimates by 30 cents. stock is up 11%. results were helped by its successful shift to cloud-based products. okay. when we return, we're going to talk trump and trade with the director of the national trade council and trump adviser peter north ameri navarro. plus, much more on the market moves this morning. the s&p and nasdaq closing a the new highs. could this be a sign there's more room to run? take a look at the futures right now. "squawk box" returns in just a moment.

the trump rally. dow 20,000 within striking distance after record closes for the nasdaq and s&p 500. new this morning, china responds to trump's tough trade talk. our special guest host this hour, trump's trade czar peter navarro. plus, life off the field. nfl hall of famer emmett smith is here with his latest business venture. the final hour of "squawk box" kicks off right now. ♪

live from the most powerful city in the world, new york, this is "squawk box." put me in coach. emmett smith, center fielder. good morning. welcome back to "squawk box" here on cnbc live from the nasdaq market site in times square. i'm joe kernen along with becky quick. >> how many goals did he score? >> and andrew ross sorkin. the futures right now, this is what -- oh, what! that's it! when the futures hit 87, that means 20,000. >> just leave this board up for the rest of the morning. >> the dow close thed at 19, --i

right? that is incredible. that's exactly 20,000. >> i wonder if the traders have anything to do with that. >> we'll see. maybe it'll be up before 9:45. who knows. anything can happen. that's why it helps to keep watching. what else did we want to look at. i don't know if we want to look at anything else. i'd leave that there. >> we can voice over the rest of the hour. >> do we have our hats ready to go? >> no, but we won't be here on the set when it opens. >> that's right. the dollar and treasuries. europe and asia were both strong. europe up more than 1%. some big gains on the nikkei and other averages. it's not just us. >> no. let's tell you about some of today's other top stories. oil prices are slipping this morning after builds in u.s.

inventory reinforced expectations that shale output this year could reduce the impact of production cuts by opec and other major exporters. wti right now down 56 cents to 52.63. wells fargo -- a "wall street journal" report said the bank gave employees time to cover up problematic sales practices. >> so crazy. >> much harder now. why are they doing this? >> the move is also part of wells fargo's internal review following charges it created consumer accounts without authorization. >> this was a bank we all thought was best of breed, this sort of -- you know, not wall street, sharky place. they had all their internal controls under control. and then you find out it's not just this weird thing they were doing with these -- terrible thing they were doing to

customers, but they have all these other internal things. >> ways of playing the system and beating around the edges. >> the whole bank, across the board. we haven't talked to buffett about it either. >> taking this very personally. watching the pain in your voice. >> well, only because i think frankly the bank -- dare i say, we all misrepresented what was going on at this bank. that's troubling. >> i agree. we thought it was best of the banks. there's something else going on there, and we have not dug into that deeply enough. >> it's always little things. >> it totals -- you know, we're in the single hundreds of thousands of dollars or low millions. >> low millions. when all these class-action

lawsuits are done with, it's not going to be a low million story. >> it speaks to culture. >> i know, i know. it's just that banks in the past have done some really egregious stuff. >> this is a bank we stood on a pedestal, very different. warren buffett stood it up too. moving on. it is a light day for economic data. the fha is going to be releasing its november home price index. that comes out at 9:00 a.m. eastern time. >> can you find a place for that? don't put it on. >> what if you put it on backwards like a rally cap? >> how did you get it to stay up there like that? i'm having problems. okay. here. >> as usual, having problems getting it to stay up. but anyway, let's go. >> wow.

>> wow. >> wow. >> this awkward moment has been brought to you by joe kernen. >> no, i pointed it out. >> you're tagged. >> this is a family program. it's been a busy morning for earnings. let's tell you about some of those earnings this morning. dow component united technologies reporting fourth quarter profit of $1.56 per share, matching consensus estimates. revenue was also roughly in line with forecast. then take a look at boeing this morning. it also reported earnings. $2.47 per share. that beat estimates by 12 cents. 2017 forecasts, we should tell you, were shy. becky quick? right now let's get to politics. president trump is expected to sign an executive order today to begin paying to build a wall on the u.s./mexico border. a senior official tells nbc news that the president will shift money from other federal programs to the wall project. congress would have to approve any extra appropriations beyond that. trump still intends for mexico to pay for the wall eventually. and chinese state media is

reacting today to president trump's trade policies and some of his comments. an article in the people's daily warns that a trade war between china and the u.s. would harm both countries. the article also says that since china and the u.s. are major players in global supply chains, numerous other countries could be exacted by any trade war as well. and to enforce his ideas, president trump created the national trade council with a mission to get american jobs back on soil. joining us now, the newly appointed head of the council and friend of "squawk box." good to see you, peter navarro. i love these shots now. you get to just walk around there like you own the place, don't you? >> i pinch myself. joe, you remember the last time i was on the show? day after the election. what did i predict, right, that we were going to have a big trump rally. it's lovely being on today, the day we might break 20,000 on the

dow. pretty cool. it's so cool. we're sitting here doing exactly what president trump said he was going to do. he got out of tpp. we're going to start negotiations and talks with all sorts of countries on all sorts of deals. we signed keystone yesterday, jobs created, nikkei is rallying in asia. it's all good. >> a lot of things are lining up, peter. there are those that argue that the efficient market hypothesis, the market's never wrong and the market is anticipating something good here. there's obviously animal spirits and corporations feel better, small businesses feel better. but then there's a whole other narrative, peter, that we got to do this right. there's some adverse consequences to some of these things, and you got to, you know, just walk -- tread lightly with china, tread lightly with mexico. where do we -- how do we make sure we balance both of those

concerns? >> they're legitimate concerns, joe. the advice i give here is basically to simply keep saying what the president said during the campaign, which is that what we're concerned about is american workers, american domestic manufacturers. we'll trade with any country in the world as long as that trade is fair. we will defend ourselves against cheating. we will renegotiate bad trade deals is that have taken jobs and offshored our production. one of the big things i'm concerned about, joe, is not just the loss of our manufacturing base but the loss of our defense industrial base. we no longer have the capability to put the airplanes in the sky, the ships on the seas to defend ourselves over the longer term. so talk softly, carry a big stick, eventually once we get our manufacturing and defense industrial base back, and work with everybody. i think it's going to be great. president trump is the most

positive individual in the world. every time a little bit of ink flows out of that pen, there's a lot of jobs created. >> peter, on the manufacturing front, and we've talked about it a lot in terms of bringing back jobs, whether we are fighting an old war. given ai and robotics and all of that, it's going to be very difficult on a one-for-one basis to bring back meaningful jobs to this country given the fact that computers and robotics have taken over. how do you think about that issue? >> that's a great issue, andrew. that's kind of the narrative that says, well, the robot's going to eat our jobs, why bother trying to get them back. let me say two things about that. first of all, the moast advance country in terms of robotics is germany. 20% of its work force is in manufacturing. we have 8%. that's number one. number two, robots in the factories, that's fine if the

robots are here and they're helping build our defense industrial base. but remember, the big misconception here is that the jobs, which we really need, are the ones that exist in the big boxes with names like ford and gm on them. those big boxes that we see in this country are basically assembly plants assembling foreign components, putting in cars that are branded american. what we need to do here, andrew, is to get -- reclaim our supply chain. a lot of that supply chain will have automation, will have high technology, but it has a lot of workers in it. that's what we need to get back. so let's work with automation. let's be innovative. let's increase productivity. we can increase our wages when we increase our productivity. but we can't be sending our jobs offshore. >> peter, how much of the changes in terms of bringing jobs back do you attribute to changes in trade agreements, and how much of it is the fear of the tweet that ceos live with? even before president trump was

president, he was scaring ceos. nobody wants to get called out on the carpet. he's been bringing people to the white house already. i can't imagine a ceo looking around saying i'm going to build a plant overseas and not thinking twice about it because of fear of being targeted. >> yeah, i think he's going to be the 21st century teddy roosevelt. he knows how to use the bully pulpit. he knows how to use the pen. he knows how to use executive orders. it's a friendship that he develops with these people that also allows him to create jobs for the american people. so i think this is going to be all good. we're seeing action every day. i think we're going to look forward to strong growth and job creation. this is not to say that we're not going to have bumps along the road. we're inheriting a very difficult economy. we're inheriting a world of globalization. it's going to take a while to get it back. >> peter, seems like we're going

to bilateral now instead of multilateral. >> absolutely. sovereignty. >> it seems like it might take longer, but the multilateral approach, sometimes one size doesn't fit all. the journal wasn't necessarily the anti-trump administration like some other mainstream media. >> maybe, maybe not. >> right. the editorial page versus the -- i don't know about the difference between. but they talk about all these regulations and global trade that have been layered on since world war ii. when you just throw them all out, there's like weird domino effects that can happen and unintended consequences. do you think that's something we need to worry about if we just throw out the entire playbook and start from scratch with bilateral agreements? >> not at all. there's a couple things going on. first of all, i strongly believe that bilaterals can occur much more quickly because basically it's a few people in a room talking about what needs to be done. multilatera

multilaterals, you get hundreds of people and thoses of lobbyists and lawyers. it takes years and years and years. we think we can get bilateral deals done quickly. as we're negotiating with one country here, we're going to be negotiating with another country here and another country here. so i think it's a much more efficient way to do that. in terms of unbundling this other thing you mentioned, we'll always go back to first principles with president trump. what we said was, what we need to move forward is lower corporate taxes. that's the first principle in terms of getting our jobs back. reduced regulation, energy. we need to unleash that sector. we need to do trade smartly, not dumbly, like it's been done for the last 15 years. >> peter, do you have any anxiety that the cost of a car, the cost of big screen tvs, all of this go up? that effectively, while we may help on the other end, we're also creating a tax on some of these products. >> yeah, there's two things there. one is that the analysis that i've done, the price effects are

relatively modest. what i'm more concerned about is getting people to work, not just with a good job and a good paycheck, but a paycheck that's going to go up over time because of productivity gains. what we've had for the last 15 years, joe, and you know, this is zero growth in our average median household income effectively. that's because we've had a trade regime which has dumped products all over the market and created a situation where america has not been able to compete on a level playing field. >> peter, holman jenkins says trying to boost wages of low-skill workers by reducing competition for their jobs has perverse effects, increasing their incentive to remain low skilled. >> but holman jenkins, that's a false narrative. that's not what we're trying to do. one of my jobs at the national trade council is to focus on matching the skills that are needed by our industries with the skills of our workers. we envision a more germany-style

economy where 20% of our work force is in manufacturing, and we're not talking about banging tin in a back room. we're talking about high technology across the board, whether it's computer chips or cars or anything in between. so holman jenkins, false narrative. "new york times" today, totally false narrative on the front page on tpp. these are the things that the trump campaign and now the trump administration is going to be dealing with for the next four years, but it's good to be able to talk about this frankly and point out what the truth is. >> it is good. peter, initially we had you on to talk about china all the time. i don't know whether -- i was in davos. just for me -- >> better you than me, joe. >> but president xi was kind of welcomed as a -- it was bizarre the way it moved from one foot to the other. he was talking about globalism and not being nationalistic and not putting your own nation ahead of other nations.

he was quoting abraham lincoln. no one pointed out the sort of irony. it was just all accepted at face value. wow, we got trump, this guy who's a populist and nationalist. we got the gentle sort of -- the great foresight of the chinese president. was there any irony you saw when you heard that coming from president xi? >> i think it's stockholm syndrome basically. you had all the globalists in the room in davos like they do every year. they're in the world of the new trump reality of free and fair trade. who do they grab on to, you know, come on. it's pretty funny. i wouldn't waste a plane ticket on davos. i will never go there, i promise you that. >> well, you don't buy a plane ticket. you fly private if you're a globalist and go over there to solve the income inequality. you need to fly private, obviously. >> peter, can i follow up with that. you said the story on the front page of "the new york times" today is a false narrative. we heard a similar idea from

former commerce secretary bill daley this morning. he just pointed out if we're in the there, if we scrap tpp, as we have, if we're not there, involved with it, that it does leave an opening for china to kind of step in and take over our role. what's false about that narrative? >> read the executive order. the executive order said we're going to withdraw from tpp and we're going to pursue bilateral trade deals with our allies. that's exactly what we're going to do. we're starting that this week. >> i guess i should point out bill daley said he thinks that will take quite a lot of time to negotiate a deal on a country-by-country basis. >> i get back to my point with joe. you have bilateral deals. mr. trump knows how to do a deal. you sit a few leaders in a room, you negotiate the deal. wilbur ross and i during the campaign worked out kind of the parameters and what we see as a model agreement. it's pretty straight forward. we know what we want. we want tighter rules of origin. we want a country, if we have a

deficit with them, to make concrete plans to buy more of our stuff and move from there. we're concerned about things like state-owned enterprises having unfair trade advantage. we're very concerned about dumping steel and aluminum into our markets. we think we can build strong relations bilaterally with countries that want to together reclaim their is supply chains m countries around this world which have been dumping components and basically getting the best jobs. bilaterals will go quick. becky, tell me a multilateral deal that's been done quickly. tell me. >> right. these things take years and years. >> this is trump land. let me explain this. we get things done. we'll get things done. >> who's first? if you look at the asian pacific countries, who should we be thinking the first agreement will be? >> if i told you, i'd have to kill you. that's a state secret.

we'll let president trump deliver the new news. what i can do here is tell you what has happened and what it means. >> i read something this morning also, peter. it said that, you know, so we try to renegotiate nafta with mexico and mexico says if there's anything in here that makes it less advantageous for us, we're going to walk away from the table. then i saw 80% of their exports come to the united states. when they say that, should it be taken seriously? or is the leverage clearly coming from washington? >> so along with my prediction for 25,000 on the dow, my prediction is this. we're going to have the most amazing relationship with mexico and canada in this hemisphere. we're going to build basically a power house in this hemisphere with a restored supply chain. we'll be a global power house. and it's going to be an amazing thing, to quote the president. >> excellent. peter, thanks for all your time. >> great to talk with you guys. always fun to be on "squawk."

if the dow hits 20,000 today, it'll be a nice bookend to the day after election when everyone was gloom and doom. >> we used to be sitting here from uc irvine. now you're talking and you have the white house right here. it's like, this guy is unbelievable. it's amazing what little washington scenery, gravitas can do. not that you weren't like that already. >> they even gave me good weather today. it's been miserable. it's all good in "squawk" land. >> i like that. a lot still ahead on "squawk box." defense spending under president trump. a former senior pentagon official will join us after the break. back in a moment. is happening before our eyes. shift in human history sixty to seventy million people are moving to cities every year. at pgim we help investors see the implications

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president trump pledging to rebuild a depleted u.s. military in his inaugural address. joining us now is the former deputy assistant secretary of defense and assistant secretary of state under president george

w. bush. the general now advises defense and security firms overseas. you look at what the president has proposed thus far and seems to be on the march in terms of doing. are you in agreement with all this? >> i am. i think, as you said earlier, the defense budget has been depleted. the size of the military has been depleted. it's at its smallest level since before world war ii. at the same time, the missions are just exploding. it's time it get a bigger defense budget, and it's time to grow the military. >> what should that number look like? and in terms of the priorities, one, two, and three from you. >> the number should be well over $100 billion, larger than it is now. our country has traditionally put somewhere between 3% and 4% of its gdp into defense spending. it's about $582 billion, which

is about 3% of the gdp. adding simply a half percent of gdp to the defense budget adds another $100 billion to the defense budget. >> what would we be getting for that money? >> sure. i think you'd probably increase the size of the force by at least 10% to 20%. you would increase the amount of training our soldiers and airmen are allowed to do. they're severely restricted in the number of flying hours they're getting and the number of tank hours they're getting. and frankly, i think you'd see some investment in modern weapons systems that we've held off for quite a number of years. personnel, up tempo, procurement. >> the president has made it clear he has some problems with it, it's just the efficiency of how we spend that money in terms of what we're spending it on and the deals we're getting from the boeings and lockheed martins and

everybody else. >> that's a good point. in fact, not only if you increase the size of the budget, but you save money by cutting better deals with some of these defense industries, you might be able to get another 25 billion just by better pricing with some of the big american primes. >> i don't know if you looked at this, but the biggest conundrum in all this is he wants to spend this money, but there are members of the gop worried about increasing the debt. is that something you think about at all? >> i certainly do. people talk about increasing the debt $5 billion to $8 trillion over the next ten years. let's remember, president obama in the space of eight years doubled the national debt from $10 trillion to $20 trillion. what did we get for it? my personal belief is investing in the defense industry and military makes us safer and quite frankly if you look at the business i'm in, that will increase the type and quality of

equipment that we sell overseas to countries around the world. >> general, we appreciate your time this morning and perspective. thank you, sir. >> sure. when we return, the ipo that wasn't. the tech unicorn will no longer make its public debut tomorrow thanks to a surprise deal. we have the details next. "squawk box" will be right back. ♪ nice work brother dominic. now we just need 500 more... translated into 35 languages, personalized oh and shared across the 7 continents. (other languages spoken) look abbot, i got it. it's a miracle. ♪ may not always be clear. but at t. rowe price, we can help guide your retirement savings.

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welcome back to "squawk box." opponents have been criticizing president trump's characterization of jobs numbers. our senior economics reporter steve liesman is here. he has a little bit of a breakdown and explanation. >> at the end of this, yoe is going to tell me to give it up. it was one thing when president trump said wrongly that the 96 million americans not in the labor force were all looking for work. it's just 5.4 million who say they want a job, according to the bureau of labor statistics. the rest are retired, students, or homemakers. but now that he's president, president trump should get the number right. no matter what he does, this number is going to go up under his presidency. in fact, four years from now, the number that trump says is so awful at 96 million is very

likely to top 100 million. why? as little trump can do about it, chris rupkey says, government policymakers should not focus on bringing down the numbers of americans, not in the labor force because it is simply going to grow larger and larger in the years to come. the number has gone up every year since 1990. growth weakens in good economies and accelerates in weak economies can like it did from '09 to '12. the growth rate has come down. 2016 was the best year since 2006. but it's still growing and going to keep growing. some who have jumped out could come back in. but the 65 and older population will grow, according to census data, but about 7 million people during trump's four-year term. many of these, about 70%, are not going to end up in the labor force. >> so it's just demographics. >> it's just demographics. i'm just saying, let's get on the right number. a lot of economists say if you get the number right, you can better get policy right.

you don't want to bring these people back in. it's not the right metric. we don't want to judge him by the wrong metric either. obviously i won't, but if he gets the number right, it's 5.4 million. there are others who want a job for economic reasons, they're actually unemployed. probably the labor slack is somewhere around 15 or 20 million. he should get the number right. it's a distraction. >> here's the thing. once again, this is all i'll say. it's a number that's been used for the past eight years by the people who say things aren't great or people that are worried about wages not growing. that's the number people have been using. the labor participation rate has been the metric people use to say things -- or the number of part-time jobs. >> sure. but you can make your point with those numbers. >> you make it to conflate it with these are people that want to work that can't get a job, or

to just mention it's at a 40-year, 50-year high. just to use it as sort of a talking point or an example that things aren't -- we haven't had -- you don't need to take it literal literally. that's what the left does with trump. >> forget the left, forget the right. economists say there's a number, let's use that number. four years from now if it's 100 million, did trump do badly? >> i don't think it will be. i have hope the participation rate improves. >> the participation rate can improve. i've done the modeling. if he gets to the very best number that this has ever been as a percent of the total labor force, he can bring 1.1 million of those people back in. that's it. and that's going to be overwhelmed by retirement, and it's not his fault. >> to make things look good, he won't be using the same numbers. he'll change it. >> fine. let's use the right numbers. we'll get the right policy.

>> this is like alternative facts. sometimes things really are in the eye of the beholder. >> i'm willing to look at alternative measures. i was the one who introduced the concept of the real unemployment rate. i was the first guy to do that. now, it became rick story. >> some news just broke while we were speaking. rer this out of jpmorgan chase. "wall street journal" reporting the bank has struck a deal to be the us can to-- custodian of mo than $1 trillion of backrolackr assets. jpmorgan stock is up. that's worth tens of millions in annual fees to the bank. the other thing that's worth noting is another trillion dollars under management, so to speak -- not really under management. >> custodian.

>> to be the custodian helps jpmorgan but goes to this issue of the big getting bigger. >> how many trillions does blackrock have? >> 5 trillion. this is just one-fifth of the portfolio. >> not just big getting bigger. can we also look at the futures right now. jpmorgan is a dow component. state street is not. if you're going to see additional benefits going to a dow component, that could push us a little higher this morning. again, we've been watching as the dow -- oh, at this point, it would open well above 20,000. it needed 87 and change to get to 20,000 today. it's already sitting at 92. >> it must be fractions of a basis point for what you get for that though, andrew. out of the trillion, you must need to go way out on the decimal points for what the actual, what you make from a trillion dplollars, just holdin on to it. >> absolutely. >> i'd take fraction of a

decimal on a trillion. >> i would too. >> but we've talked about how do you regulate massive banks. you add another trillion dollars. >> but there's an issue with blackrock and whether a company like that ought to be inside the framework or not. now we have big questions about is the framework, are those things donald trump supports. >> steve, thank you. >> my pleasure. when we come back, the trump trade. the market's making another run for dow 20,000 as we just showed you. dow futures at this point up 93. that would put us above 20,000. we'll talk to two strategists next. stay tuned. you're watching "squawk box" on cnbc.

welcome back, everybody. check this out. the dow is poised to cross 20,000 at the open. you're now looking at the futures up 101 points. we needed less than 88 points to put us over 20,000 at the open. so watch this very closely. we are less than an hour away from the opening bell. today could be the day. s&p futures are up by almost ten points. the nasdaq up by about 26. >> we may not close above 20,000, but we're trading above

20,000. i want one of those things. what are those things? >> the bats? >> no. >> a twirler? >> no, new year's eve. >> i thought you meant like the pittsburgh steelers. joining us now to talk about all this is dan suzuki, senior u.s. equity investment strategist at bank of america, merrill lynch. also, paul hickey. gentlemen, we're thinking today could be the day we push above. as joe mentioned, not necessarily close here, but paul, what do you think is really driving some of this, and are you a believer there's more room to run? >> well, yeah, so finally. it's been a month of people constantly watching for this. you look at the markets, we saw a big rally in november following trump's election on the idea of pro-business policies. market paused for a little bit. the conventional wisdom was sell at the inauguration because once rubber hits the road, it's going

to be more difficult. now trump's come into office, it's only been a couple days, but some of the pro-business policies we've seen have gotten the market going. i think it's sort of ironic here because we've heard about how disorganized and not ready for prime time this whole transition team has been, but this has been, as far as the stock market is concerned, the smoothest transition period for the stock market from election to inauguration ever. the maximum decline we've seen is 1.2%. if you go back to any newly elected president, the transition period was much rockier in every instance. >> yeah, i would say, dan, i saw a statistic yesterday that the s&p for over 70 days hasn't moved down by 1%. it's been a fairly steady march upward. >> i think it's exactly right. i agree with what he was saying. i think that what you're seeing is there's three things driving the market today. it's trump and his policies. it's confidence, and it's improving growth.

as long as you have at least two of those three things going, i think there's tremendous support for the market. one of the things we've been recently talking about is how the central bank put is dead, but it's been replaced by a more powerful put, which is the trump put. in the next three or four months, i think there's huge downside support for the market. if you get any kind of pullback, you'll see a ton of investors come in and buy the market. there's huge upside. any news that comes out in the near term, bad news people are going to be complacent about, but good news people are going to get excited about. i think there's an asymmetrical reaction in the markets today. >> it sounds as if you guys are both looking for the perspective of additional gains to come. what would happen if you did see something? i'm trying to think of what would knock it off. we talked earlier about tariffs. maybe a 35% tariff being dropped on goods. >> so the reason why i think there's a trump put is i think in the next three, call it four months, you're not going to get any clarity. that type of clarity, in terms of the policies. so you kind of live in this blissful ignorance. once you get clarity on the

policies later in the year, i think ultimately you're probably going to get some digestion as the policies are more likely to be delayed and more likely to be watered down when they're eventually passed. between now and then, it really doesn't matter. i think, you know, the bigger near-term risks, call it in the next five months, five or six months, are probably more outside the u.s. you have a lot of elections happening in europe and what knwhatnot. in the u.s., i think you have this blissful ignorance for a while. >> trump came in as an outsider, doesn't owe anything to anybody. well, no one in congress owes him anything. so that's something to watch. will congress, will they go along with his policies, or will there be friction there. >> i can think of about eight senators who owe being a senator to trump. a lot in the house of representatives too. >> that's a really good point. >> i mean, i know what you're saying. they're not beholden to him. >> we talk about how ceos live

in this fear of the trump tweet. what about individual congressmen and senators themselves? we saw what happened to paul ryan when we went up against him. >> it's just something to watch when you ask for what could be a possible risk in the market. that's something to watch on the policy front. it'll be interesting. this whole outsider status, jimmy carter, granted a completely different perspective, got nothing done when he was in office because no one owed him anything. he had no relationships with members of congress. >> all right. paul, dan, thank you both for being here today. >> thanks, guys. >> thanks. >> everybody needs high-def at home. people are really made we have make america great. are you out of your mind? you have trump hats on your set? >> show them what it says. >> actually, that is a trump hat. okay, i'm sorry. i'm sorry. coming up, nfl legend emmett smith is getting down to business, breaking into the $5 billion men's grooming industry. he will be here with the details

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welcome back, everybody. watch this number closely. dow up triple digits. at this point, if we were to open right here, the dow would open above 20,000 today. it's that number that people have been waiting on and waiting on. if we open up by more than 87 points, you're looking at dow 20k. that's what we're watching closely. less than 45 minutes away to the opening bell. all right. our next guest is nfl legend

emmett smith. i just ran into him. he was like hot butter through a knife. no, i'm kidding. i hurt myself just shaking hands. he's now helping men take care of themselves in a different way. just point out that maybe 20,000 today. i know for a fact, because i've known you for probably 20 years, you used to talk about stocks with me back in the '90s. >> yes, yes. >> you've been watching for a long time. >> i've been watching you for a while. and you guys do a great job of communicating to the public and talking about companies and so forth. so i appreciate it. >> you've been watching when dallas was good to when dallas was horrible, to when dallas is good again. it's been that long. maybe a couple of cycles. >> it has been a while, but it's fun to see it right now. the cowboys are a very exciting team to watch. two young players that appear to be the future for the cowboys. i'm excited for them and what they're doing. i'm just disappointed we're not

playing in the big game a week from today. >> now i wish i had seen them play atlanta after watching. >> you would have thought it would have been a better football game. >> have you been playing the stock market since the election at all? >> no, i'm kind of waiting on these policies to get settled in, to see how everything settles out. it's kind of hard. >> let's talk about your own business now. >> well, i'm in the real estate business. right now we're talking about men's grooming. the gent's place. it's a high-end luxury grooming spot for men to come in and get their haircuts, straight-edge razors, get your shoes shined and your pedicures and manicures. it's really one of the fastest growing segments in the beauty care lines. so gents place is a wonderful spot. we have a couple spots in dallas as well as kansas city. >> you want to open them up

around the country? >> we're look to expand, do about 150 locations around the country. we're focusing in the miami area, houston, some other parts of the country as well, california. >> new york? >> new york would be a great spot. you know real estate up here is very, very, very, very very, ve very expensive. >> commercial real estate is your area so that's really where you've been focused. >> it's part of my expertise. but with gents place it's more about helping men feel better, look good, feel good about who they are and taking care of their feet. you know women, women do a very good job of taking care of themselves. y'all do. >> so how do you get men to want to do this? you know, my wife made me do this once or twice -- >> she made you do it? >> she did. >> but it's cool now. >> my toenails were not in good shape. >> it's cool now. >> yeah, but even i, joseph, haven't gotten into the pedicure thing in a meaningful -- >> you don't want hairs coming out your ears, do you? >> no. >> you don't want hairs coming out your nose, do you?

>> what's the tipping point in all of this? or is it just a generational thing in terms of the age? >> 35 to your age and much older. i mean, at the end of the day i take the philosophy just like i took on the football field. if i look good, i feel good, i play good. in this particular case, if i look good, i feel good, ki go do business better. if you're feeling good, sometimes you treat people better. a lot of times you do. all because you're in a better mood. gent place is one of the places to give you an opportunity to get into a better mood. >> how's your real estate ventures? how does that differ? >> it's not different. starbeck had a large brokerage firm. they were global and he sold his company as we all probably know back in 2008, i believe, and from that point on i started out in the real estate business with roger. >> did you really? >> yes, i did. >> you can do worse -- what'd he sell for? was that a private sale?

>> he sold for a pretty nice size number. i mean, it's probably traceable. $700 million to jll. >> awesome. >> he's doing great. he's doing great. the legend is doing fine. >> well, we'll see with, you know, small businesses are very bullish right now, emmitt, might be a good time to be doing this. >> i think it is a good time to be doing the things we're doing. we just need things to settle down in washington a little bit so we know what the rules are and we can get back on the playing field and start to do what we want to do as a small business moving forward. >> great to see you. >> thank you for coming in. >> go get your hair and nose and stuff all taken care of. >> i'm on it. >> in between your toes. no, that's hobbits. let's get down to the new york stock exchange. jim cramer joins us now. jim, at the open we're going to see it, don't you think? we'll get that maybe not a close, but we're going to get that print. >> yeah, i mean, as long as interest rates continue to percolate higher, slong we get a sense there's nothing that can

come out from left field, the earnings this morning are all in keeping with a story that could drive the dow. and i like that. there's no -- there's really no flaws in the earnings we've had this morning except for freeport which is not a dow stock and oriented to commodity price. so you have the tinder to make it happen. >> europe is strong. we were strong yesterday. >> yeah. >> whatever's happening, you know, i don't know, chicken and egg, but asia was strong. i mean, today, i know these round numbers they don't mean anything but i still like them. i think it will be fun to see 20,000. >> yeah, i agree. >> usa today have it on the cover tomorrow. >> three days ago people on friday getting short again. they were saying this is when you really have to start worrying flt he's going to be inaugurated, we're going to get bad after. doesn't matter if it gets bad, gets good, ideas of a lot of people in the mainstream media, what matters is we are in earnings season and earnings are

pretty good. it's not necessarily president trump is doing anything to derail the earnings. therefore we can keep the high multiple on them. a lot of companies we thought did poorly last week that are dow stocks, like ibm, a good quarter. american express was a good quarter. initially the prism was that they weren't. america's best to 90, ibm to 200, these wouldn't p difficult. so i think it is a lasting rally. i feel like i've been alone other than you in saying maybe there could be something going on here that's positive. but we take our cue from the stocks, not from washington. >> that's a way to look at it too, jim. you said at this point there's no reason to think that necessarily anything detrimental is going to come out of the administration. you're not even saying -- we don't have to have faith these are positive things. as long as we don't derail the earnings rally, then that would be enough. >> right. >> and then if anything good happens from this stuff, that's just gravy. >> that's exactly my position. i don't hear anything.

when he meets with the ceos, i do not hear, listen, you guys got to make less money. i don't hear, listen, we're not going to help you down the road. i see deregulation in the oil patch, again, there's a lot of people who hate that. but if it's going to come out of the ground, then it's going to be used in pipelines. pipelines put a lot of people to work. when i hear d.r.horton, employment's really good. i have no surprises, i see banks everyone was shorting, remember how wise it was to short banks because the rally was over? they're coming right back, why? because interest rates are going higher. washington is not in the way of the rally. washington is not in the way of earnings. the dollar has not meant that much. only drug stocks have been difficult and that's because they could be a subject of a tweet. >> right. you had to buy the election, sell the inauguration. doesn't look like it's going to work. >> that was the rap. yeah, it's tiresome, wasn't it? it was tiresome? >> so many things are tiresome. but i'm in a good place, andrew.

we're both in a good place now. and so is becky with the new kid and everything, right? anyway, jim -- two new kids. >> and two kids. >> i don't have a screaming brat around. anyway, no, no, they're cute. >> little peanuts. >> i just have myself screaming. and then tomorrow on "squawk box" don't miss first on cnbc interviews with fords ceo mark fields fresh from his meeting with president trump. that will be good. we'll be right back. 90% of the world's largest supercomputers run on intel?

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welcome back everybody. let's take one more check on the equity markets. if you've been watching this morning, you know that we are looking to open above 20,000 if we are going to open here. >> we need 87. >> we need 87 and change. we're at 94 and change. so, again, it looks like we could finally cross that dow 20,000 mark just at the open if things continue to stand here. s&p futures up by 8.5, nasdaq up by 25. strong day yesterday for the markets too, dow up triple digits, s&p 500 and nasdaq sitting at new highs. >> traders would have to be really evil. >> to push it and steal it away from us? >> no, if they didn't do it now. if they moved it back under 87 just to make us look bad for saying it's going to happen.

that would be really -- >> don't give them any reason to go ahead and push that. >> the algos. >> they don't have emotions. >> except that some of them do. that's what i'm worry about. artificial intelligence may not like us. they don't need us eventually. >> watch closely, folks, we're just half an hour from the opening bell. >> join us tomorrow, we may be talking about a close above 20,000. we'll see. "squawk on the street" coming up next. indeed today could well be the day. our best shot at 20k so far. good wednesday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer, david faber at the new york stock exchange. premarket as joe, becky and andrew said indicates an opening above that 20k level. europe and asia with some nice 1% gains this morning, oil pretty steady. in a few moments cisco's chuck robbins on the company's deal to buy app dynamics before that start-up's ipo. so this morning could be very interesting. we're going to get to boeing and utx earnings in just a moment. but firs